The next few weeks should be an interesting time for your clients. They’ll feel the natural pull of several opposing emotions: fear, greed and maybe a dose of inertia. And you’ll be caught in the middle trying to strike a balance.

First the fear. Just earlier this week, the Investment Company Institute, the mutual fund association, released a study that concluded investors’ risk tolerance had not rebounded to pre-crisis levels.

No big surprise in that really. In fact, the only surprise to me over the past couple of years has been the appearance that some analysts and executives in the industry don’t seem to understand investors’ newfound fear of risk in the first place. A number of conversations I’ve had with professionals in the field have taken on a theme of encouragement. That is, they’re encouraging investors to get back into the market and take advantage of the opportunities out there. But instead of getting up and dancing while the music is playing, many investors had become wallflowers. They would rather just stand and watch.

The ICI’s study shows that older investors have actually rebounded somewhat in their appetite for risk, although not to the same levels of 2008. Younger investors, who have a higher threshold for risk in general, have not rebounded at all. They’ve been on a slow decline for the past three years.

Statisticians could point out that even a small change in the specific time frame used in such a study could potentially alter the results. And this one has a time frame that looks odd at first glance; the 12-month periods that it analyzes are from May to the following May. Still, as a gauge of investor sentiment, it shows an interesting trend of cautiousness.

But then we come to markets. And we just had a stupendous September. The S&P 500 Index jumped 8.8% in the past month. That’s a decent increase for an entire year, let alone a month. And in July, we saw a 6.9% increase, although, granted, in between we had a 4.7% falloff in August.

So what did wallflower investors do during these gains? During the September surge, they went to the side and just watched, pulling $15.6 billion out of equity funds.

So clients will find themselves at a crossroads. History suggests that investors chase performance. But they also are still haunted by the nightmarish markets of 2008 and early 2009. And if they do continue to pull back, there is also a good chance that old-fashioned inertia will set in because sometimes sitting and watching is easier even if the market is notching monthly gains. So many will continue to sit and watch.

I understand that this is why the professionals encourage investors to get back into the game. They know that inertia is hard to overcome. But meeting that challenge needs to come after the conversations about fear and risk. Clients need to feel good about dancing before they get out there.

And just as important, they need to have an investment plan. Clients certainly could have a true change of heart and decide the time is right to take a new approach. But if they are simply chasing performance, you need to talk about that too, and use your sway to create a solid investment plan with them. One obvious sign of chasing performance is when they start scouring the rankings of the best portfolio managers, particularly for the big, liquid asset classes like large-cap domestic stocks. You might suggest going with an index fund or ETF for that type of asset class, and saving the active managers for the smaller cap companies and foreign investments.

We have a real-life lab experiment setting up to give us the chance to observe investor psychology. Conventional wisdom says that investors zig when they should zag. And with the markets acting the way they are these days, that could be expensive zig.

In short, advisors have their work cut out for them.