Risk is in attendance at every decision we make, yet questions like ‘how much risk are you willing to take?’ prove very difficult for most people to answer.

At the very extremes of risk taking and risk aversion this distinction may be a bit clearer – but then, few people fall at the extremes of a distribution.

Nevertheless, this is the kind of question that financial advisers need answers to. Regulators around the world require that a client’s risk appetite should be taken into consideration when recommending products that they deem appropriate.

Personality psychology highlights extreme variation in people’s propensity for risk taking.

Learn more about how to manage risk in the financial sector here via the FT Times