Portfolio Risk Assessment Calculator

Use this to check the risk and possible loss of your investment portfolio based on the asset allocation.

This tool helps you:

Design an investment strategy tailored to your risk tolerance and financial goals. It can show how to allocate assets and diversify risks so you can live comfortably even with unrealized losses from market volatility
It also allows you to explore the relative safety of different asset classes, for example, how long-duration bonds compare to stocks when considering both interest rate and credit risk.
Additionally, the tool demonstrates how risk can be mitigated by increasing the number of holdings in your portfolio, helping you understand the benefits of diversification and make more informed investment decisions. Find out more by clicking

Asset Class Weight & Volatility
Stable	Weight
Type \ Duration Short: duration ≤3 years Medium: duration ≤9 years Long: duration >9 years *Floating-rate deposits are considered "Short"	Short	Medium	Long
Time deposit
Stable fund Stable value fund or money market fund with minimal interest rate risk and credit risk.
Sub-total
Bond	Weight
Type \ Duration Short: duration ≤3 years Medium: duration ≤9 years Long: duration >9 years *Floating-rate bonds are considered "Short"	Short	Medium	Long
Treasury including government-sponsored agency's mortgage-backed securities (MBS)
Municipal
Corporate
High yield a.k.a. non-investment-grade bond, or junk bond
Sub-total
Equity	Weight	Volatility
Preferred stock
Value stock
Growth stock
Real estate & REIT
Sub-total
Riskiest asset	Weight	Volatility
Cryptocurrency
Commodity
Derivatives
Others such as hedge fund, private equity, leveraged ETFs, and other alternative investments
Sub-total
Total portfolio		Volatility

Risk Assessment
Total assets balance
1-year volatility
1-day volatility
Set confidence level
1-day % gain / loss can be	within ±
1-day $ gain / loss can be	within ±
1-year Value at Risk (VaR) Value at risk is a professional measurement of the risk of portfolio. It estimates how much a set of investments might lose (in 1-year period prescribed here, and with a given probability you set below), under normal market conditions.
With probability
$ loss can be (worse than)
% loss can be (worse than)
Breakdown of % loss
Interest rate loss
Bond credit loss
Equity & riskiest assets loss
Diversification benefit Because interest rate, bond credit, and equity market are not perfectly correlated, your overall risk (probable loss) can be reduced if your portfolio is diversified in several less-correlated asset classes.
1-year Sensitivity in Down Market
Interest rate :	the portfolio may lose
Bond credit spread :	the portfolio may lose
S&P 500 index :	the portfolio may lose

The volatility (risk) of an asset class

Number of holdings within an asset class The asset class refers to one of the 8 classes we categorize. (Preferred stock, Value stock, Growth stock, Real estate, Cryptocurrency, Commodity, Derivatives, Others.)

Volatility of a single holding (in average)

Typical volatility range:

Preferred stock	10% ~ 30%
Value stock	20% ~ 50%
Growth stock	50% ~ 100%
Real estate & REIT	20% ~ 50%
Cryptocurrency	50% ~ 100%
Commodity	10% ~ 60%
Derivatives	80% ~ 300%
Others	10% ~ 200%

Correlation between holdings (in average)

Typical correlation coefficient:

Concentrated in one industry	0.7 ~ 1.0
Diversified in several industries	0.5 ~ 0.7
Diversified in many industries	0.4 ~ 0.5

Volatility of this asset class calculated by assuming equal weight of each holding.

Benefit of risk diversification

Number of Holdings and Risk

probability	in 1 day	in 1 month	in 1 year
% loss can be (worse than)

By using this tool, you can also assess how to reduce risk within an asset class by increasing the number of holdings and/or reallocating investments among less-correlated companies.

How Risk is Reduced in Longer Period

This tool helps you:

Understand the benefits of long-term investing and the power of starting early. By investing over a longer horizon, you can reduce overall risk while taking advantage of compounding returns to grow your wealth more effectively.
It also allows you to explore how the distribution of returns differs between the short term and the long term, helping you see the potential volatility you may encounter along the way.
Furthermore, the tool can help you determine how long you should invest to bring the probability of low or negative returns down to a level that aligns with your risk tolerance, giving you confidence in your long-term investment strategy.

Portfolio Risk and Return

1-year volatility

Typical volatility range:

Multi-asset portfolio	use "import"
Investment-grade bond fund	3% ~ 7%
High yield bond fund	7% ~ 15%
S&P 500 ETF	16% ~ 24%
NASDAQ index ETF	20% ~ 28%
Value-stock fund	15% ~ 25%
Growth-stock fund	25% ~ 35%
Riskiest-asset fund	30% ~ 100%

Note: this is recommended for evaluating a portfolio, not for a single stock (like betting on one stock!), which may have more unknown idiosyncratic or delisting risk

You can import the "1-year volatility" calcuated from " Risk Assessment" table above, or manually fill the number.

Annual yield We recommend to fill an long-term, objective expectation based on the assets in the portfolio. For example, 5% for corporate bond fund, 8% for S&P 500 ETF, and 9% for NASDAQ-100 ETF. The higher the yield, the higher the volatility should be considered.

Set confidence level The more conservative you are as an investor, the higher the confidence level to consider.

Lower-than-range probability equal to (1-confidence level) / 2.
This is the probability that the outcome (return) will be worse than the lower bound of the range showed below.

Holding Period and Annualized Return

Max tick to show:

Holding Period and Total Return

Probability of total return below

Content created by

AlexCFA, FSA, FRM, MBA

Alex is a seasoned finance professional with over 18 years of experience in investment management and financial technology. He began his career as a financial advisor and later led large-scale budgeting and risk management initiatives at global consulting firms. He also brings extensive experience as both an investment analyst and a software engineer. Alex is a CFA® charterholder, Fellow of the Society of Actuaries (FSA), and Financial Risk Manager (FRM®).

Portfolio Risk Assessment Calculator

Use this to check the risk and possible loss of your investment portfolio based on the asset allocation.

This tool helps you:

Asset Class Weight & Volatility