From what I have seen it appears that: A loss no greater than 10% is Below Average A loss no greater than 12% is Average A loss no greater than 14%+ is Above Average I’m not taking this as an exact solution but from my memory this strikes to be the case… I could be totally wrong though. Any thoughts.
I believe I have seen examples with below average Willingness stated as a loss no greater than 12% (I don’t remember what Risk Tolerance came out to be in that example).
I’d too would be interested in people’s assessement of this…
willy, did you really see "A loss no greater than 14%+ is Above Average " and that implied above average risk tolerance?
Yeah…I think that’s what CFAI is using. But, Isn’t it dumb? I have 100$ - if I am willing to end up with 90$ I am risk averse. If am willing to end up with 86$ I am a risk taker?
I thought i did on one of the tests… I could be mistaken though this is from memory.
v good question!i i m also very puzzled. but i think i saw a tolerance for the loss of12% indicate a below avg risk tolerance…