Help, my portfolio’s giving me a heart attack.
Help, my portfolio’s giving me a heart attack.

IS IT TIME TO STRESS TEST YOUR PORTFOLIO?

As we all know, when we are making money in the stock market our tolerance for risk and volatility seems to grow along with our portfolio balances.  But, what happens when that inevitable market correction comes along?  Can your retirement withstand the potential downside risks of your investment portfolio?

To compound a down-sized portfolio due to a potential market correction, most retirees are withdrawing principal and/or income from their investments to cover their monthly living expenses – and are thus forced to sell portions of their investments when their underlying values are low.  Truly, this is risky business.

So, what’s your risk number?  Matching your portfolio to your risk number may help you sleep better at night.

Once your risk number is known, a stress test of your existing portfolio can be conducted to see how well it matches up to your risk number.  

A portfolio stress test will help show you how a particular investment portfolio might perform in a given stock market condition based on its specific history.

The first step is to know your risk number.  You can get started here:



© 2017 Jane B. Smith, CFP®

This material is for use with the general public and is designed for informational or educational purposes only. It is not intended as tax or investment advice and is not a direct recommendation for your retirement savings. LFS-1843931-071117