arbster
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Post by arbster on Sept 22, 2015 13:06:39 GMT
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mikes1531
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Post by mikes1531 on Sept 23, 2015 17:13:15 GMT
I found it interesting, though not particularly deep, so I'm not sure it told me anything I didn't already know. But there's also a link on a later page to Schroders' IncomeIQ test and that was quite interesting and somewhat revealing. |
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james
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Post by james on Sept 23, 2015 21:23:43 GMT
The IncomeIQ test did have one probably wrong question, though:
What would you prefer?
1. £1,000 today
2. £1,100 in a year
This is a standard investing question that gives the wrong answer for those who know how to reliably obtain growth of more than 10%. The "correct" answer for those who can defer pleasure is supposed to be 2 but those using P2P today may well prefer 1 because it makes them more money.
Followup questions offer 12, 3 and 14% returns.
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mikes1531
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Post by mikes1531 on Sept 23, 2015 21:46:04 GMT
Followup questions offer 12, 3 and 14% returns. I interpreted the following questions to offer 20%, 30%, and 40% returns. And I didn't interpret the question as being related to risk. I took it as asking whether people would rather have a lesser amount of money now or were willing to wait and have a bit more. So I opted for all the deferred choices because they were bigger. I didn't consider that I could do better than 10% -- which I probably couldn't better once tax was considered. And I didn't consider the case of inflation being over 10% either. Perhaps I wasn't thinking deeply enough.
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james
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Post by james on Sept 23, 2015 22:02:01 GMT
Sorry, you're right, it's 10, 20, 30 and 40%.
You're right about the purpose of the question.
It was quite unusual because it did include questions with higher growth that would allow someone to decline 10% but take 20, 30 and 40% and still give some inclination towards thinking other than in the short term. Though perhaps asking people what returns they think they could would provide better context for the answer.
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