Kelly Amadon, CFA, an investment adviser, has two clients: Ryan Randolf,65 years old, and Keiko Kitagawa,45 years old. Both clients earn the same amount in salary. Randolf, however, has a large amount of assets, whereas Kitagawa has few assets outside her investment portfolio. Randolf is single and willing to invest a portion of his assets very aggressively; Kitagawa wants to achieve a steady rate of return with low volatility so she can pay for her child's current college expenses.
In Randolf's case, the investment may be appropriate given this client's financial circumstances and aggressive investment position. This investment would not be suitable for Kitagawa because of her need for a steady rate of return and her low-risk profile.