Your goals tend to set the tone for your investment program, and they play a major role in determining how conservative (or aggressive) you're likely to be in making investment decisions.

Question

Quizplus · Accepted Answer

Goals can influence risk tolerance and dictate the investment strategy that is chosen. For example, someone with a long-term goal of funding their retirement may choose to be more conservative with their investments to minimize the risk of losing funds. On the other hand, someone with a shorter-term goal of purchasing a home may choose to be more aggressive in their investments to potentially earn higher returns.

Your Goals Tend to Set the Tone for Your Investment