The meaning of risk. What does risk mean to you?

Times said:
"Risk comes from not knowing what you're doing." - Warren Buffett

I completely agree with Mr. Buffett.

Lots of people think the risk is your planned risk to reward ratio, but if you planned to lose it, that wasn't much of a risk.

The real risk in trading are those loses that weren't planned, and those come from not knowing what you're doing.
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In other words " It is the presence of what you are not certain of".
 
For me risk portrays the amount i may have to incur by investing in some asset. And hence i never risk more than i can afford to lose.
 
ElectricSavant said:
Risk is the fear of losing.
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If so then it would be difficult to quantify your risk.

As a trader I want to be able to define my risk so that can rationalize, in my mind at least, if the reward is worth the risk.

A coin flip for a couple bucks is a risk I would take but I wouldn't flip a coin for my entire portfolio. Granted it is fear of losing that governs my decision.
 
To be brave you gotta' be scared...my trading improves when I respect money.

Mechanical trading somewhat removes the "pain of losing" that gets etched in your soul when you have followed your system.
Es

deaddog said:
If so then it would be difficult to quantify your risk.

As a trader I want to be able to define my risk so that can rationalize, in my mind at least, if the reward is worth the risk.

A coin flip for a couple bucks is a risk I would take but I wouldn't flip a coin for my entire portfolio. Granted it is fear of losing that governs my decision.
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ElectricSavant said:
To be brave you gotta' be scared...my trading improves when I respect money.

Mechanical trading somewhat removes the "pain of losing" that gets etched in your soul when you have followed your system.
Es
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Exact opposite for me; I'm a chicken. When wining or losing doesn't matter, trading becomes so much easier.

A mechanical system with a defined risk (I'll risk 1% of capital on a trade) and a strategy with a proven edge, allows one to fearlessly make trades, knowing in the long run the system is profitable.

DD
 
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