What is Risk?
Author: raj
Category: Finance, Investing
Risk is when you need to sell your yacht and Gulfstream IV
Via Economist.com
John Devaney, a hedge-fund manager who had to sell his 142-foot yacht, Positive Carry, and his Gulfstream IV after making bad bets on mortgage bonds, told an audience: “I’d like to thank the market for dealing me a direct hit. As a trader if you don’t get sucker-punched every once in a while, you don’t understand what risk is.”You might suppose that meeting in America’s gambling capital would provide symbolism enough.