what is an investment objective 
an investment objective is used by asset managers to determine the optimal portfolio mix for a client investments are chosen using the guidelines of the investment objective an investor questionnaire often defines financial goals and objectives and determines the asset allocation within the portfolio based on an individual s time horizon risk tolerance and financial situation understanding an investment objectivecommonly based on one of four strategies that include income growth and income growth or trading an individual s investment objective clarifies investment ideas to help achieve an individual s financial goals the information that an individual provides to determine their investment objective may include annual income and net worth average annual expenses timeline to withdraw the money and the maximum decrease in the value of the portfolio with which the investor is comfortable the portfolio is tailored according to the answers provided to these questions and a strategy is defined as an investment objective risk tolerance is the degree of risk that an investor is willing to endure given the volatility in the value of an investment a client with a high risk tolerance interested in growth may have a short term aggressive portfolio which includes stocks and trading opportunities a moderate risk investor may have a balanced portfolio of growth and income instruments that may include stocks and bonds a conservative investor with low risk tolerance may focus on an income generating portfolio using dividends and bonds 