In our risk profiling we gather the information about age group of the client.
Whether they want to invest in short time horizon it's involve risk. or wants to long term investment.
In trading or investment, risk stands for “the loss of capital”. We assume, if client opens demat account then he understand the investment in stock market is subject to market risk and he/she is ready to take at least small risk and comes default in low risk category.
We obtain the necessary information about their current liabilities and borrowing from Banks or from financial institutions or from any other means of finance to access their tolerance level.
Whether they want to invest in short time horizon it's involve risk. or wants to long term investment.
We obtain information about what is the source of Income of the client and what is his/her annual income. Expenses of the client and Fund that can be save for future investment. We obtain information about their existing investments/assets, whether it requires diversifying their investments
On the basis of discussion with client & analysis of their current assets and their current liabilities we decided the Risk appetite of the client and tolerance level of the client.
Product Suitability Table :-
Category | Risk Score | Product Suitability |
---|---|---|
Very High Risk | 23.0 - 30 | Option writing, Positional Future, Leverage Trading, FX, Category include High, moderate and low risk |
High Risk | 15.5 - 22.5 | Intraday cash & future. Delivery Trading, Naked Option (Buy Side), MCX Trading, Category include moderate & low risk |
Moderate Risk | 8.0 - 15.0 | Intraday Cash (No leverage), Delivery Trading & option strategies, category include low risk |
Low Risk | 0.5 - 7.5 | Pure cash trading (least quantity), Delivery trading (least qty), option strategy, Bank FD, Post office scheme |
Risk profile and product suitability of the client is communicated through mail to the client after risk assessment is done.
Thanks & Regards
Team Absolute Finserve