Jim Cramers Real Money Sane Investing In An Insane World

Contents Of Rich Dad, Poor Dad Robert Kiyosaki

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Rich Dad, Poor Dad
Lesson One: The Rich Don't Work For Money
Lesson Two:Why Teach Financial Literacy?
Lesson Three: Mind Your Own Business
Lesson Four:The History of and The Power of Corporation
Lesson Five:The Rich Invest Money
Lesson Six:Work to Learn - Don't Work for Money
Overcoming Obstacles
Getting Started
Still Want More? Here are Some To Do
How To Pay for a Child's College Education for $7000

RISK TOLERANCE

Besides learning about an investor's financial background and previous investing experience, good futures brokers delve into the risk tolerance of their customers. This is a critical consideration when developing a trading plan designed to reach specific objectives. The plan must be one the customer is comfortable trading.

When doing this, a good broker attempts to classify the customer's attitudes toward risk. Each customer is an individual, and each one reacts differently to risk. If a broker doesn't deal with this, a lasting bond of trust will not be created.

When classifying attitudes to risk, economists use the term utility, which is a measure of personal satisfaction. If something provides a feeling of greater satisfaction than whatever it is compared with, it is said to have greater utility.

As experienced brokers discuss trading strategies and risk-to- reward ratios of specific trades with their clients, they learn to classify customers as averse, neutral, or aggressive risk takers. For example, a risk-averse person may not be interested in a trade that would be projected to return a dollar for every dollar at risk. These traders want to take little or no risk and are satisfied with low, but dependable, returns. If you fit the risk-averse description, you probably should not be trading futures ( Rich Dad, Poor Dad).

The risk-neutral traders may consider trading options and/or what appears to be the most conservative of futures trades. The ag­gressive risk takers are the ones most commonly thought of as futures traders. These people are willing to take the risks required to get high utility (satisfaction) from making successful trades( Rich Dad, Poor Dad).

When you consider your suitability to trading futures, look closely at all three of these areas—financial situation, investing ex­perience, and risk tolerance—before you fill out the account papers and send in your check.