RAW2020: Probability for Pragmatists

https://2020.riskawarenessweek.com/talks/managing-irreducible-risks-through-portfolio-analysis-hedging-and-diversification/ The success of quantitative risk management rests on our ability to assess probabilities, but what is a probability anyway? How do you know if your assessments are any good and what does it even mean to say there’s a 50% chance of rain tomorrow? A pragmatic approach to these questions quickly takes us in… Continue reading RAW2020: Probability for Pragmatists

3 steps to apply Monte-Carlo simulations to any investment project decision

Risk management 2 shouldn’t be difficult. So I started on a quest to come up with a simple methodology for quantitative risk analysis that will actually improve decision making. This is still work in progress, so any comments and suggestions please send them to me or write below the article. Also don’t forget, RAW2020 is… Continue reading 3 steps to apply Monte-Carlo simulations to any investment project decision

RAW2020: The Cat Insurance Puzzle: Why People insure their Cellphone but not their Home – Annette Hofmann

https://2020.riskawarenessweek.com/talks/dr-annette-hofmann/ The cat insurance puzzle refers to the low or missing demand for high-severity-low-probability events, which is surprising given the high demand for low-value insurance products such as cell phone insurance policies. While the loss of a cellphone is usually an event of no or low consequence, the loss of a home to a family… Continue reading RAW2020: The Cat Insurance Puzzle: Why People insure their Cellphone but not their Home – Annette Hofmann

Here is a small lesson I learned a while back

If you want to integrate risk management into decision making, you have to talk the same language as decision makers. That means that if the decision is made based on IRR you need to calculate an alternative IRR, based on risks. If the decision is made based on NPV/EV/FV you need to calculate new NPV/EV/FV… Continue reading Here is a small lesson I learned a while back