Risk Appetite
Ten questions on financial, physical and social risk give a score out of 100. Population mean is 50 with an SD of 20. Risk tolerance peaks around age 25 and falls after 65.
Ten questions across money, social, physical and career risk, in the style of Dohmen et al. (2011). Pick the answer closest to what you would actually do.
1.How much of a month's salary would you invest in a high-risk, high-reward opportunity if you had the chance?
2.You're offered a 50/50 chance to win $1,000 or lose $500. Do you take it?
3.How willing are you to say something controversial at a dinner party if you believe it's true?
4.How likely are you to approach a stranger you find interesting and start a conversation?
5.Would you try an extreme sport (skydiving, bungee, free climbing) if given the opportunity?
6.How willing are you to try unfamiliar food with unknown ingredients in a foreign country?
7.Would you quit a stable job to start a business with a 20% chance of becoming highly successful?
8.How comfortable are you with uncertainty in your professional life?
9.In general, how willing are you to take risks? (1 = very risk-averse, 5 = very risk-seeking)
10.Looking back, most of the best things in my life came from taking a chance.
Answer all ten questions to see your score.
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About this test
Ten questions on money, safety, career and social risk, each answered on a 0 to 4 scale and normalised to a score out of 100. The questions follow the general risk item of Dohmen et al. (2011), Review of Economic Studies, and the Global Preferences Survey (Falk et al., 2018). The module places you on a normal curve with mean 50 and SD 20.
A score of 70 is higher than about 84% of people; 30 lower than about 84%. In the Global Preferences Survey, which covered 80,000 people in 76 countries, risk tolerance falls with age and is somewhat higher in men on average; country differences are larger than either.
What is a normal level of risk tolerance?
The middle: between 30 and 70 on this scale covers about 68% of people (mean 50, SD 20). Where you land within the range depends heavily on domain. People who take financial risks are not reliably the ones who take physical ones.
Does risk appetite change with age?
Yes, it falls. In both Dohmen et al. (2011) and the Global Preferences Survey, willingness to take risks declines steadily from the twenties onward. The drop is gradual, not a cliff, and varies by country.
Which countries are most risk tolerant?
In the Global Preferences Survey (Falk et al., 2018), risk tolerance is highest in several African and Middle Eastern countries and lowest in parts of East Asia and Europe. Country differences explain more of the variation than age or gender. The module compares to a global mean, not your country.
Percentiles above come from the same parameters the Risk Appetite module uses. See the methodology for how they are calculated.