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雕刻时光
Sculpting in time

每一个故事都有起点与终点
Every story has a beginning and an end.

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I recently read the blog post Risk Allocation Framework by Eric Xu, which also made me think about my own risk resistance , especially in the face of uncertain events that occur.

In 2021, my main focus is on quantitative finance. Although the quantitative field sounds advanced to the layman, most commercial companies generally do not disclose algorithms that can be profitable directly in the market, and it still takes some coincidence and opportunity to profit from publicly available algorithms. In my opinion, no matter how many times your earnings, one thing you always have to consider is how to bear the risk, if you invest in a stock, the beginning is a lot of earnings, and finally because of market volatility factors lead to all your earnings to zero, and the cost also fell to 90%, this time how do you talk about profit. In the field of investment you can survive for how long, it shows how high your ability to resist risk, do not let yourself out easily, once out, you will never have the opportunity to enter the profit.

Back to the allocation of risk, no matter what you do, the first thing to consider is risk rather than return, anticipate risks in advance and then find ways to hedge those risks. In Eric Xu’s article, it is mentioned that modernity brings risks all over the world, for example, we use modern transportation, transportation provides convenience, but it also has safety hazards, hospitals operate on patients, providing life-prolonging technology, but there are also side effects, we can not escape the risks that exist in society, so how to cope with it, We can protect ourselves against these risks by purchasing auto insurance, travel safety insurance, medical insurance, so that when these risks come, we won’t lose all our money overnight. Like the Covid-19 incident in Shanghai now, we can all encounter similar incidents at any time and any place, and no one can escape the risks of modernity. However, the article also mentions the iron fist, which he defines as the allocation of risk that cannot be appealed. For a risk that already exists to happen to the other party, we can prevent it early, but it seems that there is a risk that we cannot avoid that is the iron fist, in the role of the iron fist, we do not have the ability to hedge the risk, because it allocates the risk to everyone, and everyone must obey this allocation, not to transfer the risk. We can understand that the risk is generated and distributed by the Iron Fist, but it will not take any responsibility for itself, need to be assigned by each person to bear the risk, this practice is also contrary to the Taleb has been advocating “risk sharing”, then how to resist the Iron Fist, we can do the following points:

  1. block out the noise, spend as little time as possible on social networks, spend more time learning.

  2. learn survival skills, such as understanding medical knowledge or learning to send radio signals to the outside world without any network.

  3. buy items or tools that will bring you rewards in the future.

  4. Stock up on BTC, ETH, cryptocurrencies in the sense that they are decentralized enough to be anti-fragile.

  5. Work and hobby at the same time, so that in the event of a wave of unemployment, you can reverse both, hobby to profession, profession to hobby.

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不断的学习思考, 保持好奇心
Keep thinking, Stay curious
始终保持对于新事物的敏感
Always be sensitive to new things