When you ask most investors how much risk they are comfortable with, they say "moderate." But "moderate" means different things to different people — and it tells you nothing about how your portfolio would actually behave in a market downturn. A Risk Number changes that.
How a Risk Number Works
A Risk Number is a score from 1 to 99 generated by Nitrogen (formerly Riskalyze). It quantifies your portfolio's exposure to volatility — specifically, the probability and magnitude of loss over a 6-month period. The score incorporates both your emotional tolerance for loss (how you feel when your portfolio drops) and your financial capacity to absorb losses (whether a decline would actually change your retirement plans).
Nitrogen also calculates a Risk Number for your specific portfolio — based on the actual holdings, not a generic allocation. This means you can see exactly how much risk you are currently carrying, and compare it against your personal risk tolerance.
The Risk Number Scale
Very Conservative
FDIC-insured savings, money market, short-term bonds. Minimal growth potential; maximum stability.
Conservative
Mostly bonds and fixed income with a small equity allocation. Suitable for retirees with low risk capacity.
Moderate
Balanced mix of stocks and bonds. Appropriate for many pre-retirees and early retirees.
Moderately Aggressive
Primarily equities with some fixed income. Suitable for investors with long time horizons and high risk capacity.
Aggressive
Concentrated equity exposure. Appropriate only for investors with very long time horizons and high financial capacity to absorb losses.
The Misalignment Problem
The most common finding when MRB Capital Group runs a portfolio risk assessment is misalignment: the investor's personal Risk Number (their tolerance) is significantly lower than their portfolio's Risk Number (their actual exposure). A person who scores 40 on the personal risk assessment may be holding a portfolio with a Risk Number of 70 — far more volatility than they are actually comfortable with.
This misalignment often develops gradually: a portfolio that was appropriate at age 45 drifts more aggressive as equities outperform, allocations are never rebalanced, and the investor never realizes how much risk has accumulated.
What Your Risk Number Means in Dollars
The most powerful aspect of a Risk Number is that it translates abstract volatility into concrete dollar amounts. Instead of saying "your portfolio has moderate risk," Nitrogen shows you: "Based on your current holdings, there is a 95% probability your portfolio will be between +$X and –$Y over the next 6 months."
For a $500,000 portfolio with a Risk Number of 70, that downside range might be –$125,000 in a bad 6-month period. Seeing that number in dollars — not percentages — often changes how investors think about their risk exposure.
Frequently Asked Questions
What is a Risk Number?
A Risk Number is a score from 1 to 99 that quantifies how much volatility your portfolio can withstand. Generated by Nitrogen (formerly Riskalyze), it reflects both your emotional tolerance for loss and your financial capacity to absorb a downturn.
What is a good Risk Number for someone near retirement?
There is no universally "good" Risk Number — the right number depends on your income needs, time horizon, and financial capacity. However, most financial planners suggest that retirees and pre-retirees should have a Risk Number in the 30–55 range, reflecting a more conservative allocation that prioritizes income stability.
How is a Risk Number calculated?
Nitrogen calculates a Risk Number by analyzing your portfolio's historical volatility, downside exposure, and the probability of loss over a 6-month period. It also incorporates your personal risk tolerance through a questionnaire about your emotional response to hypothetical gains and losses.
Find Out Your Risk Number — Free
MRB Capital Group offers a complimentary portfolio risk assessment powered by Nitrogen. In minutes, you will see your portfolio's Risk Number and what a major market decline would mean for your retirement income.
Find Out If Your Portfolio Matches Your Risk Tolerance
The free Riskalyze assessment takes 3–5 minutes and gives you a personalized Risk Number — so you can see if your investments are aligned with your actual comfort level.
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Richard Placette II
Financial Advisor, MRB Capital Group
Serving Beaumont, Lumberton, Port Arthur, Orange, and Southeast Texas
Educational content only — not individualized investment advice. This article is for informational purposes only and does not constitute investment, tax, or legal advice. Consult a qualified professional before making financial decisions.