The new book The Risk-wise Investor by Michael Carpenter provides some very interesting thoughts on risk.
Greater knowledge of a danger creates greater safety."
- B Mandelbrot
"The degree to which an outcome varies from expectations."
-Peter Oppenheimer
"3/4 of the mistakes a man makes are made because he does not really know the things he thinks he knows."
-James Bryce
"Expect the best, plan for the worst, and prepared to be surprised."
-Dennis Waitley
"Before a problem can be solved, it must be clearly stated and defined."
-William Feather
Risk can be viewed as a:
Hazard - What could be a potential harm?
Probability - What is the chance of an event?
Consequences What is the result from my action?
Potential adversity or threat - What is the risk of certain behavior or an action?
Greater knowledge of a danger creates greater safety."
- B Mandelbrot
"The degree to which an outcome varies from expectations."
-Peter Oppenheimer
"3/4 of the mistakes a man makes are made because he does not really know the things he thinks he knows."
-James Bryce
"Expect the best, plan for the worst, and prepared to be surprised."
-Dennis Waitley
"Before a problem can be solved, it must be clearly stated and defined."
-William Feather
Mandelbrot discusses three types of uncertainty. There is mild, wild, and slow uncertainty. Mild uncertainty is the measurable. Wild uncertainty is the same as what Taleb describes as black swan events. Risk that can not be measured. Slow uncertainty is the transition state between the two extremes.
Risk can be viewed as a:
Hazard - What could be a potential harm?
Probability - What is the chance of an event?
Consequences What is the result from my action?
Potential adversity or threat - What is the risk of certain behavior or an action?
Bryce is (intentionally or not) paraphrasing Samuel Clemens, "What gets us into trouble is not what we don't know. It's what we know for sure that just ain't so."
ReplyDeletethanks ...Bryce is just rephrasing the old comment. SC is always good for an interesting turn of a phras.
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