Your attitude to investment risk from 1 to 5 (1 = Low 5 = High)

The more investment risk you are prepared to take with your pension drawdown fund the higher the potential growth rate (but the lower the degree of security).

Your attitude to investment risk:

1 = I wish to take little or no risk (which, subject to other resources, will likely mean you should buy an annuity at retirement)
2 = I am prepared to accept a modest amount of risk for at least 5 years
3 = I can afford to take a medium amount of risk for at least 5 years
4 = For the potential of improved growth, I am willing to take higher risks for at least a few years
5 = For the potential of improved growth, I am willing to take higher risks for as long as possible.

Note:
A ‘medium’ degree of investment risk (3) is considered to be a level of risk that equates to an investment portfolio containing a broad spread of shares in the largest public companies in the country, as would be represented, for example, by the FTSE 100 Share Index. This index represents the largest 100 public companies in the UK, measured by size (market capitalisation). This does not mean that we would recommend the whole of your pension fund be invested in UK equities, or that you should buy into a fund that tracks the FTSE 100 index, as a balanced portfolio will include some asset classes that carry lower risk (such as property and fixed interest securities) and others that would carry higher risk, such as funds investing in shares of companies in other stock markets around the world, or in companies that are not in the top 100 by size (market capitalisation). However the overall balance of risk would be in the range of the risk of a fund that tracks the FTSE 100 Index.

Investments can fall as well as rise and future investment returns may not resemble past performance.

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