FE Analytics launches risk assessment tool

Financial Express Analytics has launched a new risk-profiling tool that enables IFAs to use a single system to record a client’s attitude to risk.

The tool makes it easier for advisers to recommend a risk-adjusted asset-allocation model and link this with the client’s own portfolio.

It uses an independent questionnaire written and designed by eValue FE – the stochastic forecasting business that Financial Express bought from Towers Watson at the end of January – to quantify how much risk an investor is willing to take.

After the client has taken the questionnaire, the tool rates their risk-appetite out of a score of five, and provides recommended asset-allocation mixes according to the client’s response.

The results also take into account the time-scale of investment. The recommended asset-allocation model can then be compared with the client’s existing portfolio in the Analytics portfolio-builder tool.

The questionnaire is inline with FSA guidelines and has been validated by experts in occupational psychology and psychometric statistics. It is available to all Analytics users and can be branded with an IFA’s logo for use with its clients.

Analytics offers unlimited online storage of risk questionnaires, as well as portfolio and fund information, at no extra cost.

Gary Wheeler, head of sales and account management at Financial Express, said: "Risk-profiling and asset-allocation modelling is a critical part of the advice process."

"Within this upgrade, Analytics will equip advisers with a robust method of identifying a client’s risk tolerance and using that as a foundation from which to build a customised portfolio."

"IFAs can now use Analytics to take their clients fluidly from the initial consultation stage to risk-assessment, on to asset-allocation recommendations and finally to fund selection."

"Our aim is to provide a comprehensive audit trail of the advice process to support advisers as they seek to comply with RDR and to ease their administrative burden."