Investment Planning Process – Suitability

SuitabilityEvery client is different and has different needs and budgets. You need to make sure the investment solutions you recommend match all their needs. When assessing suitability, the investment recommendation must take into account not only their attitude to risk/loss, timescales and need for access to capital, but also a range of other factors including their:

  • attitude to cost
  • need for investment breadth
  • investment knowledge and experience
  • need for involvement in investment decisions
  • need for review.

A client’s needs and attitudes can cover a wide range

Concerned about the costs of investments and adjusting their portfolio Attitude to cost of investing Accepting that a much wider choice and regular adjustments to their portfolio incurs more costs
Comfortable with a concentrated range of high quality funds Investment breadth and personalisation Prefers to choose from an inrestricted range of investments
Understands the concept of funds and investing but doesn't want active day-to-day involvement Investment knowledge and experience Takes an active interest in investing, monitoring and researching funds
Likes the reassurance of picking funds from an expertly researched range Involvement in investment decisions Prefers a more active involvement in decisions about their investments

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Understanding investments

Improve your investment planning knowledge by watching the following three videos that introduce suitability, diversification and outsourcing investments.

Importance of diversification

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This video looks at how to measure investment risk, how to reduce risk through diversification and how to diversify a portfolio.

Importance of suitability

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This video looks at the fact finding process, how to determine your client’s risk score and how to read risk profile scores and assess suitability.

Outsourcing investment

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This video looks at which type of outsourcing is suitable for your client, what are Multi Asset Funds, why outsource investment management and what are the benefits of outsourcing.


Support material

Business transition – investment planning options

Business transition

– investment planning options. By Mimi Pienaar

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Download the complete Investment Planning Process module as a PDF

Investment Planning

the seven key areas

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