Bullbear Buffett

Keep INVESTING Simple and Safe (KISS)***** Investment Philosophy, Strategy and various Valuation Methods***** Warren Buffett: Rule No. 1 - Never lose money. Rule No. 2 - Never forget Rule No. 1.

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Showing posts with label expected value. Show all posts

Showing posts with label expected value. Show all posts

Saturday, 21 November 2009

Understanding Risk and Decision Making

Key ideas: Probability is the likelihood of an outcome. Probabilities are expressed numerically, but are often subjective. Impact is th...

A picture of complex risks and their profiles is more useful than knowing expected value is positive or not

Risk profile A risk profile is a graph showing value - usually expressed in financial terms - and probability. Looking at the profile of ...

Making Life Decisions: appraising cost, risk and expected value, with limited information about the future

The dice games are simple parallels with the type of decision we take every day in our lives. Investments offer the most direct comparison....

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