Self-Realisation

The two risk mistakes

Risk mistake number one: Risk means failure.

This worldview equates any risk, no matter how slim, with a certainty. If the chances of hurting yourself skydiving are 1%, it’s easy to ignore the 99% likelihood that it will go beautifully.

If you carry this worldview around, you’re not going to take many risks, because your fundamental misunderstanding is that whatever is uncertain is bad.

Risk mistake number two: Low risk events don’t happen.

This is the stock investor who freaks out when the market doesn’t go up the way he and everyone else expected it to. The reason that some investments offer higher returns is that they’re not guaranteed to work. Implicit in that high return, then, is the clear warning that sometimes, you won’t get what you’re hoping for.

I’m not distinguishing between optimism and pessimism. The optimist is well aware of risks, but deep down, she believes that things are going to get better. The risk-blind individual, though, is willfully (or perhaps ignorantly) unaware of what risk actually is.

Most of the things that we do have two possible outcomes: they might work or they might not. Being able to live with the possibility of either is essential if we’re going to move forward.

Reblogged from: here

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