Advisers hesitant to challenge clients on risk attitudes

11% never encourage clients to take more risk

Tom Ellis
clock • 1 min read

Advisers shy away from challenging clients on their attitude to risk, despite evidence suggesting funds with higher risk ratings were more likely to give stronger returns in the long-run, according to research from FE.

The study of 210 advisers found 71% only "occasionally" encouraged their clients to take more risk to help them reach their financial goals, while 11% never attempted to do so. The remaining 18% said they often did so. FE said the findings were surprising given almost half (43%) of advised clients did not adopt an aggressive attitude to risk in the accumulation phase of saving.  The research also suggested advisers struggled to articulate risk accurately, with almost three-quarters (73%) conceding they relied on attitude to risk questionnaires to explain risk to clients. About six-...

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