An attempt is made through this study to identify the risk bearing capacity of retail investors and to evaluate how it affects the portfolio choices of those investors. In addition to examining the variations in investment avenues that investors choose to include in their portfolios due to their risk-bearing capacity, this study aims to investigate the influence of various demographic characteristics on risk bearing capacity. The current study was conducted among individual investors in Kerala by conducting a survey among 120 individual investors in Kerala using a structured questionnaire. The results of this study showed that an investors ability to take on risk depends on their gender, line of work, and monthly income. Further it was found that investors who are ready to take high risk invests more in real estate and shares compared to other risk categories. Investors who are moderate to high risk takers made their investment in mutual funds. All other investors made their investments in safe avenues like bank deposits, postal savings, provident fund, insurance