Understanding and explaining risk to clients

Why should advisors care about explaining risk?

Knowing the risk involved in the return changes the way clients feel about their money. This is the basis of risk tolerance. Clients can't make informed decisions about their money if they don't have the entire picture. Effectively estimating a client's risk can help them avoid behavioral mistakes, significantly impacting their bottom line. Covisum's director of product development, Ron Piccinini, PhD, recently contributed an article for the Society of Financial Service Professionals. Download the full article now.