Asymmetric Risk
Asymmetric Risk is a decision framework that evaluates opportunities based on the ratio of potential upside to potential downside, actively seeking situations where the maximum loss is small and bounded while the potential gain is large and unbounded — or vice versa when avoiding risks. The concept, central to Nassim Taleb's work on options and convexity, holds that rational decision-making under uncertainty should prioritize the shape of the payoff distribution over its expected probability of success.