Stress testing is more important than ever as we enter another season of uncertainty.

  • By stress testing your current portfolio you can see how it would likely have fared under different market shocks or stress scenarios and you can determine whether asset allocation shifts or goal adjustments need to be made.
  • Stress testing balance sheets is equally important and can reveal liquidity gaps and cash flow continuity risks should a significant unexpected event take place.
  • Your wealth plan should also undergo a stress test for a variety of factors to be sure you are prepared for life’s changes as well as regulatory and tax changes.

During times of uncertainty such as we’ve experienced this year and will likely continue to encounter, it’s so important to be sure your portfolio, balance sheet, and wealth plan have been “stress tested” to see how they stack up in case of market drops and other unplanned, significant events. As you know all too well, life is not static. Along with markets and economies, regulatory and tax environments can also be unpredictable. Therefore, your investment, liquidity, and wealth plans must be fluid and periodically monitored and tested to be sure they can withstand the stress of change.

Please see important disclosures at the end of the article.

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