The tool, created with Barrie & Hibbert, Oxford Risk and technology provider IRESS, will be available from July.

Fully compliant with FSA guidance on assessing suitability, it uses 18 psychometric questions and four suitability questions to evaluate clients’ risk tolerance, taking into their capacity for loss.

This will enable Financial Planners to produce tailored reports that explain and visualise the risk assessment process, summarise information gathered and confirm agreed outcomes.

George Higginson, chief executive of Sesame Bankhall Group, said: “The launch of our Investor Risk Profiler is another significant investment by SBG that will enable advisers to operate responsibly and efficiently in the RDR world.”

Mark Loosmore, business development director at IRESS, said: “The FSA has been very clear about the importance of understanding a client’s attitude to risk and their capacity for loss. Advisers need to ensure they have a robust mechanism in place to achieve this.

“The tool is an important aid to assist the adviser in communicating the risk to the client and, in addition, the SBG tool allows the analysis to be done at an individual goal as well as client level.”