I was speaking to a new doctoral student who is writing a thesis on the role of risk profiling in the development of an investment strategy. This led us to discuss why risk profiling was important and the purpose of providing investment advice.

To go back to first principles, what is the true purpose of investing?

Many would say the purpose of investing is to accumulate wealth. I think this misses the point. Wealth is not the end objective rather it is to have sufficient wealth to fund consumption. The act of investing simply involves foreg...