Making a comparison between the traditional investing approach and goals based investing. There is a fundamental difference in terms of the purpose.

Goals-based investing has an aim of funding future lifestyle goals for the investor and we're investing to ensure that the performance of the portfolio is not worse than the minimum return that we need to finance that goal traditional investing approaches are much more around trying to be a benchmark or generate the same return as that benchmark.

To evaluate the performance of a traditional approach fund where we need a benchmark some sort of index traditionally to compare that performance against whereas for goals based investing so long as we generate enough return to meet the goal of the investor. Then we will have performed well as that portfolio manager. So progress towards that goal is really what we need to assess the performance of our portfolio on the basis of and in terms of risk.

Well on a traditional approach risk means volatility of returns or standard deviation. Whereas on a goals-based investing approach.

Risk is underperformance.

So the risk of not generating enough return to be able to finance our goals. So the main risk or concern for the investor here is that inability to finance their goals. So goals based investing is far more focused on thinking about how people feel about their portfolios. They want to maybe make sure they've got enough money to meet a certain objective or liability in the future rather than talking about things on the traditional risk adjusted return basis.