AI Investment Policy Statement Generator

An Investment Policy Statement (IPS) is a formal document that outlines an investor's goals, risk tolerance, time horizon, and investment guidelines. Originally used by institutional investors, the IPS is increasingly used by individual investors to create a disciplined investment framework that prevents emotional decision-making.

Asset allocation accounts for 90%+ of return variability according to Brinson, Hood & Beebower (1986). This tool calculates your ideal allocation based on time horizon, risk tolerance, income stability, and behavioral response to market losses. A common starting point: 110 minus your age for your equity percentage.

Rebalance when any asset class drifts 5% or more from its target. Annual calendar rebalancing is also effective. Research by Vanguard shows that rebalancing frequency matters less than consistently maintaining your target allocation. Combine rebalancing with tax-loss harvesting in taxable accounts.

A risk tolerance questionnaire measures risk capacity (financial ability to absorb losses) and risk willingness (psychological comfort with volatility). This tool's risk score (0-100) weights time horizon, age, income stability, portfolio size, and behavioral responses to market scenarios.

Yes. This IPS follows standard CFA Institute and CFP Board frameworks. You can bring it to a fee-only RIA or CFP as a starting point for discussion, or use it independently. Always consult a qualified financial advisor for personalized investment advice.