Causes of Black Swan Risks

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Causes of Black Swan Risks
ernest agbenohevi, Member
Apparently Black Swan risks are more probable in case of higher complexities of financial systems or other decision making processes. The normal curve portrays the expected situation for any given system. The attempts to try and push the whole system to either of the extremes (optimization) I believe produces the 'Black Swan risk / survival' situation.
Since 'risks' represents our lack of appreciation and knowledge of how a system functions, highly complex situations would be characterized by 'swan risks'... The level of management of such situations depends on what we know and understand about the situation.
 

 
Black Swan Risks
Radha Raj, Member
Very interesting analysis.
 

 











 

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