Do you speak riskese? Citizens of Japan speak Japanese, lawyers speak legalese, and leading investment advisors, casino statisticians and insurance actuaries speak “Riskese.” This is a self-created word for the essential language of investing and I use it to discuss topics of risk, return, statistical significance and time. Returns and risk go hand in hand. You cannot expect high returns without taking risk. People are perfectly comfortable talking about the returns portion of the investment process, but how squeamish do they get when they realize they will lose money on their investments? After the decline of 2008, people are far more aware of this possibility, but they are still looking for that perfect investment with small risk and big returns. People are also still looking for a weight loss pill that will allow them to continue eating country fried steak, massive cinnamon buns and ice cream on a regular basis. Neither exists.

Step 8Riskese