Principle 4

You Have Some Control

To invest in the stock market, you must be willing to accept risk. But you also have to be able to sleep at night. So, it's important to think about how much risk you're comfortable with. Once you become an SMI member, we'll help you determine this by using a risk tolerance questionnaire (in the Getting Started section of our website).

The other key factor that helps identify the risk level appropriate for you is how much time you have to achieve your investing goals. If you're investing to build a nest egg for your later years, that means deciding when you'd like to retire. The more time you have, the more risk you can afford to take.

At the intersection of your risk tolerance and investing time frame is a level of portfolio risk appropriate for you.