Katherine Al Haddad

By Katherine Al Haddad

March 27, 2015

Financial Security

Investor Profiles Are Unique

Article revised on 28 July 2017

One size does not fit all when it comes to your financial security advisor. Not only do concepts of personal financial management vary widely from one person to another, but also the emotional response can be very diverse.

Therefore, an investor profile can be a precious tool for financial security advisors. Using the information collected through the process, he or she gets to know you and earn your trust. In this way, he or she can provide advice that is adapted to you.

Many parameters are considered when doing an investor profile, including the client’s financial situation, short-, medium- and long-term needs, investment goals and risk tolerance.

The three investor profiles

The Autorité des marchés financiers (AMF), which regulates and monitors the Quebec financial industry, has defined three investor profiles:

Conservative

This profile applies to people who are uncomfortable with market fluctuation. They prefer safer investments even though the returns are more modest.

Moderate

This term describes people who are willing to take calculated risks in order to obtain higher returns on their investments. To do so, they choose diversified investment portfolios.

Aggressive

This type of person embraces risk! Generally they are people who know the financial system and understand market fluctuation. They are able to tolerate losses that can be quite significant at times in order to earn very high returns on their investments.

A legal requirement

The AMF requires advisors to do an investor profile of their clients before offering advice. The agency also requires that advisors do appropriate follow-up concerning investment goals and periodically review client needs.

Feel free to contact your advisor if a life event changes your goals and needs so that he or she can review your profile.

Note: This article is intended for information purposes only and should not be construed as legal, financial, tax or other advice. The circumstances or factors may vary depending on your individual situation. Before taking action, we encourage you to consult a professional. La Capitale shall not be held liable for any consequences arising from any decision taken based on the content presented in this article.

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