By Joanne Cleaver
April 23, 2015
“Risk” doesn’t have to be a four-letter word. Yes, 2008’s losses still sting. But here’s how to start steering by looking out the windshield and finally giving up the rearview mirror.
Take a hard look at how much you can stand to lose before you make any plans to invest your money, recommends Samuel K. Won, founder and managing director of Global Risk Management Advisors, Inc., an investment risk management advisory firm to institutional investors and asset managers.
“If there was a market downturn, and there will be, are you comfortable with, and can you afford to lose, 20 percent of your portfolio?” he asks. Before you make asset allocation decisions, figure out how much you can afford to lose. That should be one of the first considerations an investor takes into account before making any changes to an investment portfolio, he says.
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