H6 Risk Before Return
Certified Financial Planner glossary · Certified Financial Planner
Definition
Capacity, emergency reserves, insurance, and sequence risk precede expected-return maximization.
H6 Risk Before Return in plain English
A client "feels brave" and wants 90/10 after a bull run, with three months of expenses in cash and a thin disability policy. H6 Risk Before Return puts capacity, emergency reserves, insurance, and sequence risk ahead of expected-return maximization. An aggressive allocation chosen for vibes is Product Push if capacity is low. Return chasing that skips the safety stack fails the care analysis. Stabilize the floor, then debate upside. Exam stems often reward the boring reserve or coverage step over the exciting equity tilt.
Related Certified Financial Planner terms
Certified Financial Planner practice questions · Certified Financial Planner flashcards · Certified Financial Planner study guide