Kiwi's Abroad - Risk Tolerance Quiz together with moving your KiwiSaver to a different provider It is important to know which is the best fund/s to recommend (bearing in mind the ultimate decision is yours)1st we need you to complete a RISK profile so we | Take the Quiz

1. In general, how would your best friend describe you as a risk taker?

A real gambler

Willing to take risks after completing adequate research

Cautious

A real risk avoider

2. You are on a TV game show and can choose one of the following. Which would you take?

$1,000 in cash

A 50% chance at winning $5,000

A 25% chance at winning $10,000

A 5% chance at winning $100,000

3. You have just finished saving for a “once-in-a-lifetime” vacation. Three weeks before you plan to leave, you lose your job. You would:

Cancel the vacation

Take a much more modest vacation

Go as scheduled, reasoning that you need the time to prepare for a job search

Extend your vacation, because this might be your last chance to go first-class

4. If you unexpectedly received $20,000 to invest, what would you do?

Deposit it in a bank account or a money market account (a fixed term savings account).

Invest it in safe high quality bonds or bond mutual funds (Bonds are normally issued by governments and sometimes large companies to raise money. This is a safer option than shares, but not as safe as a bank deposit - it also depends on the strength of the country that has issued them - for the purpose of this consider it is the New Zealand government)

Invest it in stocks or stock mutual funds (in other words the share market)

5. In terms of experience, how comfortable are you investing in stocks or stock mutual funds? (Stocks are shares - a stock mutual fund is where it is managed by professionals on your behalf - for example KiwiSaver is a stock mutual fund)

Not at all comfortable

Somewhat comfortable

Very comfortable

7. Some experts are predicting prices of assets such as gold, jewels, collectibles, and real estate (hard assets) to increase in value; bond prices may fall, however, experts tend to agree that government bonds are relatively safe. Most of your investment assets are now in high interest government bonds. What would you do?

Hold the bonds (A safe way to invest as bonds are issued by the government to raise money, sometimes they are issued by large companies also)

Sell the bonds and put the total proceeds into hard assets (hard assets are things like property, gold and art)

Sell the bonds, put all the money into hard assets, and borrow additional money to buy more

8. Given the best and worst case returns of the four investment choices below, which would you prefer?

$200 gain best case; $0 gain/loss worst case

$800 gain best case; $200 loss worst case

$2,600 gain best case; $800 loss worst case

$4,800 gain best case; $2,400 loss worst case

9. In addition to whatever you own, you have been given $1,000. You are now asked to choose between:

A sure gain of $500

A 50% chance to gain $1,000 and a 50% chance to gain nothing

10. In addition to whatever you own, you have been given $2,000. You are now asked to choose between:

A sure loss of $500

A 50% chance to lose $1,000 and a 50% chance to lose nothing

11. Suppose a relative left you an inheritance of $100,000, stipulating in the will that you invest ALL the money in ONE of the following choices. Which one would you select?

A savings account or money market mutual fund ("money market" is better understood by Kiwi's as a fixed term savings deposit)

A mutual fund that owns stocks (shares) and bonds (This is a fund - like KiwiSaver - where it is managed by professional fund managers)

A portfolio of 15 common stocks (shares)

Commodities like gold, silver, and oil

12. If you had to invest $20,000, which of the following investment choices would you find most appealing?

60% in low-risk investments 30% in medium-risk investments 10% in high-risk investments

30% in low-risk investments 40% in medium-risk investments 30% in high-risk investments

10% in low-risk investments 40% in medium-risk investments 50% in high-risk investments

13. Your trusted friend and neighbor, an experienced geologist, is putting together a group of investors to fund an exploratory gold mining venture. The venture could pay back 50 to 100 times the investment if successful. If the mine is a bust, the entire investment is worthless. Your friend estimates the chance of success is only 20%. If you had the money, how much would you invest?

Nothing

One month’s salary

Three month’s salary

Six month’s salary

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