An In-Depth Look at Risk Tolerance

By June 5, 2017 Articles

The fundamental question all investors must answer is how much risk they are willing to take to obtain their desired return. For Stephen Kuzniak, Financial Advisor at Cannon Financial Strategists, it’s a question that not only drives his daily work with clients, but one that has been the focus of considerable research.

“I’m always looking at understand what drives investor behavior, and if people invest differently in response to turbulence in the markets.”

Kuzniak, who earned his PhD in Financial Planning and Consumer Economics from the University of Georgia, spent 10 years as a researcher and economic analyst prior to joining Cannon. Risk tolerance is a research topic of interest that has stayed with him over the years. In fact, he has had multiple peer-reviewed papers published on the topic in the last year.

“It’s intriguing to me how people make financial decisions and respond to volatility in market conditions,” said Kuzniak. “I’m always looking at understand what drives investor behavior, and if people invest differently in response to turbulence in the markets.”

How people perceive risk and how they actually respond can be quite different.  “In many cases, we found that people get excited when market goes up and they tend to be more aggressive; but when the market does poorly they are often more conservative.”

Determining how risk plays into your personal financial decisions can be difficult to analyze. Stephen offers significant value with his understanding of risk tolerance and his skill in helping clients understand how they truly interact with risk.

Kuzniak’s papers can be read in detail through ResearchGate. To gain a better understanding of your own risk tolerance, contact Stephen today.