Asset Allocation Calculator







Asset Allocation Calculator
 

 

 

 

 

Years until retirement  

 

 

 

 

 

 

 

I’m comfortable with the stock market  

 

 

 

 

 

 

 

 

If my investment dropped 20%, I would:  

 

 

 

 

 

 

 

As an investor, I am:  

 

 

 

 

 

 

 

Overall risk comfort level  

 

 

 

 

 

 

 

Acceptable annual gain / loss on $1,000  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Calculator Results:  

 

 

Total Risk Tolerance Score  

 

 

 

 

 

Asset Allocation Result  

 

 

 

 

 

Stocks (% of Portfolio)  

 

Bonds (% of Portfolio)  

 

Cash / Money Market Funds (% of Portfolio)  

 

 

 

 


Calculator Definitions

Years Until Retirement - There are four different levels for this question.  The allocation rule here is simply the longer the time before retirement, the higher your potential risk tolerance.

Comfort with Stock Market -This question attempts to figure out how comfortable you are with the concept of investing in the stock market.

Investment Drop - This question tests your tolerance for a 20% drop in the value of your stock portfolio.  For example, are you going to pull all of your money out of the stock market if its value drops by 20%?

Investor Knowledge Score - This is a subjective evaluation of your own knowledge and experience as an investor.  In theory, the more knowledgeable, or experienced, you are with the stock market; the more aggressive the asset allocation can be in your portfolio.

Risk Comfort - This question attempts to figure out how comfortable you are with taking risks.  For example, are you more comfortable with stable investments, or are you willing to accept fluctuations in the value of your portfolio in exchange for potentially higher returns in the long term?

Investment Gain / Loss - This final question asks you to choose between the acceptable gain and loss pairings for a $1,000 investment.  For example, would you be willing to lose $300 in a given year for the potential to make $400?

Total Risk Tolerance - This section of the calculator provides you with your total risk tolerance score, which can range from six to twenty points, depending on how you responded during the quiz.  The higher the risk tolerance score is, the more aggressive the recommended asset allocation portfolio will be.

Asset Allocation Result - In this section of the calculator, you can see a written description of the portfolio, which runs from "Preservation" - the most conservative allocation - through "All Stocks" - the most aggressive asset allocation portfolio. The calculator provides six different levels of stock / bond allocations, stated in terms of the percentage of your total investment portfolio.


Disclaimer: These online calculators are made available and meant to be used as a screening tool for the investor.  The accuracy of these calculations is not guaranteed nor is its applicability to your individual circumstances. You should always obtain personal advice from qualified professionals.