Comment by PhilipRoman
2 years ago
Works in games too, if you're in a worse situation and almost guaranteed to lose with standard strategies, might as well try high-risk/high-reward strategies instead (since you need enough "reward" to overcome the difference and the risk doesn't matter).
"High-risk/high-reward" basically translates 1:1 with increased variance. Seeing it framed that way was a helpful mental model for me.
Thanks for pointing that out. I think that will be useful for me too, even without the finance background, that I guess you back your understand up with.
This is a good point. And seen in predatory animals. Hungry animals will take the more risky food/prey.
I don’t want to quote Einstein here, or the path not taken. ;)
Ok, the latter I know (Frost). Pray quote the former? :)