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Well if you can show one example where rewards come without risk I'll gladly cede my position. I just haven't experienced it myself in my life. I guess someone
by ianstallings 13y ago
Well if you can show one example where rewards come without risk I'll gladly cede my position. I just haven't experienced it myself in my life. I guess someone giving me a gift is risk free. But I wouldn't call that a reward.
- tikhonj 13y agoReward without risk is the usual definition of arbitrage. Some people make good money that way. Of course, you can construe any activity to have some risk. After all, there's always the possibility that your currency collapses, or something. However, ignoring that sort of possibility, risk is not necessary to make money in a capitalist system.
- ianstallings 13y agoHrm, a valid point and I would add that the risk in arbitrage is so very low because they basically only face systemic risk. Risk of financial crisis, etc. I never really thought about that until now.
- rayiner 13y agoSure. Say you're a bright young Harvard business school graduate. You might choose to either found a start-up, or go to a VC firm and help fund start-ups. The latter path is much lower risk (because you're not risking your own money, but rather that of the limited partners), but statistically you'll also probably come out ahead, financially, going that route. Or to pose another example, starting a restaurant is probably riskier than starting a B2B software company, but also probably much less financially rewarding.
- ianstallings 13y agoBut both paths come with risk. Riskier doesn't always mean more reward, but no risk at all does mean no reward. That's all I really meant. Risk is of course relevant to each of us and we all define it differently, but everyone entertains some form of risk in their lives in order to just eat and keep a roof over our heads. It's worth it :D