We make calculated risks every day – intuitively
How quickly can I jaywalk without getting hit by a car?
What if I run through a yellow light?
Eating spicy food
As I learn more about investing and trading, I’ve tried to apply those skills to life in terms of making calculated risks.
But not just intuitively. I love the idea of making decision matrices or weighing the options at hand.
My senior English thesis in High School was about the Paradox of Choice and how too many options in this world can put us in a state of paralysis of analysis. I found it interesting because I’ve used that knowledge to better my understanding of making – and going through with – certain decisions I make.
Of course, life offers many options. I chose Villanova over Toronto. I chose Economics over Finance. Every choice I make, I have to forsake something else due to opportunity cost.
But being too focused on opportunity cost may make your completely paralyzed and fail to actually make a decision.
And so there are two parts to being a great decision-maker: taking calculated risks (intuitively and planned), and making decisions and going through with them.
Being a great decision-maker. That is a strong skill to have.