<prompt> Human: Is there a way to conduct a Business Impact Analysis for lack of a better phrase on my finances in an effort to establish my risk profile?People often recommend you allocate your investments based on your risk tolerance ie: higher risk tolerance more stocks less bonds, but how would I find what that is? Is it simply a personal opinion? Is there a way to quantify the actual possibility of a major loss based on in which funds Im invested in order to determine if the potential benefits of a high stock allocation is worth it?  <response>: Its really a personal thing. How would you react if your portfolio dropped by 50 over the next week?If your answer is cash out and wait for better market conditions, then you do not have a very high risk tolerance and should invest in less risky investments to make a 50 drop less likely.Theres a good article on the Bogleheads wiki on risk tolerance: 