Mapped or targeted risk? Plugging multi-asset into the advice process

Risk-mapped or risk-targeted?

clock • 4 min read

Chris Fleming explores how to best link a multi-asset fund into the advice process to match suitability, taking a deeper look at risk-mapped and risk-targeted solutions...

The terms risk-mapped and risk-targeted are often misunderstood and used interchangeably. This is incorrect and the two terms should not be confused. The key difference between risk-mapping and risk-targeting is that the former is a process for aligning funds into a suitability framework based on a unique risk-scoring algorithm and the latter is an investment approach to managing fund solutions. A suitability framework in this context could represent a centralised investment proposition.  Risk-mapping is the process of linking or scoring any fund, or family of funds, into a suitabilit...

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