On Taking Risk

Wherever we go and whatever we do we have to make decisions. Those decisions we make have different outcomes and sometimes the expected outcome is different from what the actual outcome is. That difference is called risk. Everyday we face different kinds of risks. From the risk of losing a house, to the risk of getting a broken heart from a relationship and you name it. Let me ask you, why do we take risks? Is it because to show everyone that you are tough and brave? Or, is it because you really want something?

We all do associate risk with something dangerous and scary but when I studied investments in economics, my view towards risk has changed. In economy, risk is the difference between the expected return and the actual return. If they are  not equal then the investment is risky. But, how do we know if the investment is risky at the first place? Well, we have the history data from the firms and we measure the Beta and based from it we get an idea whether or not we should invest in the stocks or not.

But, how about when it comes to love? How do we know if he/she is worth taking the risk for? We’ve been all there. We gave our heart to someone but in the end we found out that he/she is not the one. Loving someone is risky because we never know what will happen in the future. Just like investments. The amount of love we are giving to the other person might not be reciprocated just like we have anticipated. The difference between investments and love is that in love there is no turning back once you gave your word/promise of love to the that person (unless if you do not care about the other person’s feelings). Also, love can not be measured by numbers nor the past (history) has lots to say about the future of the relationship.

For me, risk allows me to reflect on the things that I want in my life. If we really want something or someone, we are willing to do everything to get it, right? And we are ready for the consequences if we lose. Risk only shows how valuable that person or thing to us- The riskier the situation/investment, the more valuable it is and of course you will get more in return.


Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s