From Adviser Guide:
Updated Risk profiling
Q: How do I pick the best risk profiling tool?
By understanding the target market for the tool, the strengths and limitations of each tool and the extent to which it compliments your broader sales process.
It is vital you pick a tool that delivers an appropriate customer outcome.
Apart from the checklist provided by the FSA (see What are the FSA’s requirements for advisers assessing a clients’ attitude to risk?), other considerations will include;
1) usability (especially if you wish to use the tool with your consumers);
2) cost (may be marginal inside a large back office solution or an explicit monthly or volume based subscription);
3) the support that you require from the software supplier.
If you are dealing with less sophisticated consumers, some of the more esoteric features of tools and their graphical user interfaces may not be an aid to understanding.
More in this guide
- Q: What should I expect from a risk profiling tool?
- Q: What different risk profiling tools are available?
- Q: What are the pros and cons of risk profiling tools?
- Q: What are the FSA’s risk assessment requirements?
- Q: What will happen to IFAs who fail to assess risk?
- Q: What if I fail to pick the right risk profiling tool?
- Q: What should I ask risk profiling tool providers?
- Q: What does ‘risk required’ mean?
- Q: What does ‘risk perception’ mean?
- Q: What does ‘risk capacity’ mean?
- Q: What does ‘risk tolerance’ mean?
- Q: How do you assess a client’s risk tolerance?
- Q: How much should I pay for a risk profiling tool?
- Q: How do I make sure the tool works effectively?