By answering a few questions in our Financial Health Check Questionnaire, a representative risk tolerance level ('Client Risk Rating') can be determined in a few minutes.
In addition, please be reminded to regularly review the suitability of your investments and your portfolio risk, and to rebalance your portfolio as needed.
Your portfolio is comprised of funds with different risk ratings. Your portfolio risk ('Portfolio risk rating') is derived based on the weighted average risk rating of the fund holdings in your current portfolio.
Considering that investors may construct diversified portfolios with funds of different risk ratings, a holistic view will be taken to assess the risk of your portfolio. The weighted average of the risk ratings of the funds in your portfolio is compared to predefined score bands to derive your Portfolio Risk Rating. The ratings, from lowest risk level to highest risk level, are Conservative, Stable, Balanced, Growth and Aggressive. In general, a Conservative portfolio is suitable for clients with “Conservative” Client Risk Rating or above, a Stable portfolio is suitable for clients with “Stable” Client Risk Rating or above, and so forth. In assessing whether a particular fund is suitable for you, we compare your Client Risk Rating against both the fund’s Fund Risk Rating and your Portfolio Risk Rating (including the fund that you intend to invest in) to identify whether there are any mismatches.
Your Portfolio Risk Rating and Client Risk Rating are shown in the 'My Portfolio' page on the eTrading page for your reference. If your portfolio risk is higher than your risk tolerance level, a message alerting you to this will appear. Please be reminded to regularly review the suitability of your investments and your portfolio risk, and to rebalance your portfolio as needed.
For the protection of investors’ interest, if we identify a mismatch in risk ratings for a particular order from you (which may include subscription, switching and regular investment instructions) based on our holistic assessment above, we may ask you to provide additional information (e.g., percentage of investments in J.P. Morgan funds out of your total assets, specific reasons for proceeding with the order despite the risk mismatch , etc.) and in some cases we may reject the order.