Recovering Investment Losses when your Broker Fails to Understand Your Risk Tolerance

Do you have a high risk tolerance when investing your money? Or do you prefer a more conservative path? If your financial advisor does not understand your risk tolerance and makes poor decisions on your behalf, you may be able to recover for your investment losses.

To know your risk tolerance, your answer may be affected by a variety of conditions such as:

  • Your age
  • Investment goals 
  • Investment time frame / When you plan to retire
  • Financial planning for future generations

What is Risk Tolerance?

Risk tolerance is an important gauge when investing. It is the amount of unpredictability in investment returns that you are willing to withstand in your financial planning. Risk tolerance depends on your financial objectives and the ability to handle swings and fluctuations in the value of your portfolio.

The greater and faster return you want for your money, the more risk you’ll usually have to accept. If you are investing for the long-term, you can typically afford to take more risk. Investors with a high risk tolerance may be more likely to engage in “stock picking,” or attempting to hold a few stocks that might promise high returns.

But, if you are saving over the short-term or want quick access to your money, it may be wise not to take as much capital risk. For such an investor, investing substantial money in individual stocks may not be the best option. Such an investor may prefer a low-cost index fund consisting of various tradeable securities or some other investment option.

Guidance for Risk Tolerance

Financial advisors have a responsibility to avoid taking actions that put their clients at risk of financial harm. If a financial advisor fails to do so, then the investor may have a legal claim against his/her advisor.

Filing a Lawsuit Against Your Advisor

Your financial advisor is obligated to recommend only suitable financial products for your age, investment objectives, experience, and desired level of risk. If you believe your financial advisor has failed to act in your best interest, you may be able to take legal action. For an explanation of the FINRA process, see our other posts on this page.

Seeking Recovery for your Financial Losses

In legal matters, it is important to speak to a professional familiar with the laws in your state. If you believe that you have a claim against your financial advisor in Missouri or Illinois, call us Ross & Voytas.

Ross & Voytas, LLC are trial lawyers with big firm experience and small firm values. We combine objective advice with the tactical know-how to obtain the compensation you deserve.

The attorneys at Ross & Voytas bring more than thirty years of combined courtroom and litigation experience to support your rights. Clients have given our St. Louis law firm multiple 5-star reviews and we handle difficult cases. 

As natives to St. Louis and licensed in Missouri, Illinois, and various federal courts, Nate Ross and Rick Voytas provide knowledge and personal attention to your legal matter.

Don’t delay! Contact the professional attorneys at Ross & Voytas now for your investment-related legal issues in Missouri and Illinois at 314-394-0605 or learn more at

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