Appetite for risk is very personable. Some people simply cannot sleep at night unless they have ‘capital guarantees’ even though they know that growth may be sacrificed as a result. Others are the complete opposite. Capacity to take risk, however, is whether you could afford to lose and is a lot more quantitative. That said, it may not simply be based upon wealth or accumulation of assets, other quantitative things which may impact your capacity for risk are your age, goals and time lines. By using a combination of asset classes and thoroughly diversifying, the perfect portfolio can be designed for anybody.