Risk Insights

Strategic Mary wants her money to grow, but she does not want to monitor the markets too closely. After all, she is quite busy with her job and other responsibilities.

She believes the stock market will continue to rise in the long term. However, she does not want to put all her money into stocks. She wants the right amount of stocks (for her) to be able to sleep well during the down phases.

Her strategy is to split her money between stocks and bonds. It is a passive investment strategy that requires very little action. All she needs to do is to rebalance her portfolio from time to time.

Tactical John wants his money to beat the stock market. He has a bit more time on his hands and uses a few hours a month to manage his money.

While he also believes the stock market will continue to rise in the long term, he hates the down periods.

His strategy is to stay invested in stocks during up phases and to switch from stocks to bonds during larger stock market downturns (tactical switch). By doing so, he believes he will produce better returns over the long term while suffering less during the down phases.

Dynamic David is not worried about beating any particular index. He just wants his money to grow, but he wants it to be as smooth as possible. He also uses a few hours a month to manage his money.

David believes the stock market will probably continue to rise in the long term, but he wants to be prepared in case it does not happen.

He uses a dynamic strategy that gradually adapts to the market environment. By doing so, he reduces the risk but keeps the upside potential. At any time, his portfolio can be anything between 100% stocks to 100% bonds (virtually any combination of stocks and bonds).