Identifying your risk appetite is cruicle, you will be more certain in your investing decision.
Before going to the detail, I will recap the last part in the image below. You will find the investing products with the level of risk here:
Okay, so how do I know my risk appetite?
Ask yourself the following questions:
How old am I? (you might think this is a dumb question, but no, it's a research backed question)
If you are young (20-30 years old), you can stay with high risk
If you are in the middle (30-50 years old), try lower down your risk
If you are somewhere >50 years old, don't risk too much, stay below medium risk
How frustrating will I feel if my portfolio temporarily goes down for 20-40%?
If you cannot take that feeling, consider lower your risk
If you are greed for risk, stay with higher risk
Am I investing with the money I need to use soon in the future?
If yes, consider lower down your risk
If no, stay there
How much do I want my money to growth every year?
5-10% (low risk)
10-20% (medium low risk)
20-30% (medium risk)
30-50% (medium high risk)
>50% (high risk)
How much time do I have to take care of my investment?
Consider lower your risk if you don't have too much time
But don't increase your risk if you have time (it doesn't work that way), just stay with your current risk capability
After asking yourself these questions, I believe you will partially understand your risk appetite already đ
To wrap up everything, take a look at the image below, it will give you some pre-made options for you to choose.
