What Is Risk Tolerance — and How Do You Assess Yours?
One of the most common financial questions I hear is: “What is my risk tolerance?”
Risk tolerance is your ability and willingness to withstand market volatility in pursuit of long-term returns.
There are two key components:
🔹 Emotional tolerance – How do you react when markets decline 10%, 20%, or more?
🔹 Financial capacity – Do you have the time horizon, income stability, and liquidity to ride through downturns?
It’s important to remember:
Risk tolerance isn’t just about how you feel when markets are going up — it’s about how you respond when markets are under pressure.
Assessing your risk profile typically involves:
• Reviewing your time horizon
• Evaluating income stability and cash reserves
• Clarifying financial goals
• Understanding prior reactions to market volatility
• Aligning portfolio structure with long-term objectives
The goal isn’t to avoid volatility entirely, it’s to build a strategy you can stick with.
Want to know what your risk tolerance is? We can help. Call for a free consultation today (813) 286-7776.
The information and opinions expressed herein are solely those of PFG Private Wealth Management, LLC (PFG), are provided for informational purposes only and are not intended as recommendations to buy or sell a security, nor as an offer to buy or sell a security. Recipients of the information provided herein should consult with their financial advisor before purchasing or selling a security.
PFG Private Wealth Management, LLC is a registered investment advisor.