Attitude to investment risk is a latent variable and something which cannot be directly observed like, say, somebody’s heart rate. To measure effectively, it must be divided into parts, which each provide insight and together, paint a picture of someone’s overall attitude to risk.
Dynamic Planner’s market-leading questionnaire has three equal measures, assessing a client’s drivers [underlying motivations], constrainers [personality traits] and enablers [knowledge and circumstance] to taking investment risk. Together, they form a dynamic model to reach a final client profile.
Dynamic Planner’s psychometric sustainability questionnaire was a first for the wealth and financial planning profession upon launch in 2021. It is built on the same philosophy as its risk counterpart, but it uses a different model, dividing someone’s attitude into five parts: personal values; psychological distance [how your decisions benefit others]; emotional [how someone feels knowing their investments are doing good or bad]; positive impact [of their investments on the world]; and financial [willingness to forgo personal returns for wider benefits].