Quote by NICCOLO MACHIAVELLI - Deepstash

All courses of action are risky, so prudence is not in avoiding danger (it’s impossible), but calculating risk and acting decisively.

NICCOLO MACHIAVELLI

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  • When everyone believes something is risky,their unwillingness to buy usually reduces its price to the point where it’s not risky at all. Broadly negative opinion can make it the least risky thing, since all optimism has been driven out of its price
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Fear-setting

Fear-setting

It is a decision-making tool for risky situations. The main point is that visualizing the worst-case scenarios lets you manage them rationally.

There are 3 stages in fear-setting for any decision:

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The Most Important Thing Is . . . Awareness of the Pendulum

When things are going well and prices are high, investors rush to buy, forgetting all prudence. Then, when there’s chaos all around and assets are on the bargain counter, they lose all willingness to bear risk and rush to sell. And it will ever be so.

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