Train Yourself to Properly Judge Risk by Tracking Estimates Like a Gambler


The first step to compensating for your poor risk assessment abilities is to recognize you tendency to be overconfident and underconfident with most estimates. Doing so is hard, but the Wall Street Journal suggests a tactic often employed by successful gamblers:


Basically you start the week with a list of estimates about what will happen that week. That means everything ranging from the weather to world events. At the end of the week, take a look at how often you were right. The result might surprise you when you realize how bad at prediction you are. However, as you go over your data you'll be able to review your logic and improve on it. You'll never be able to estimate every probability, but a little practice will make you better at judging risks in your daily life.

How to Beat the Odds at Judging Risk | Wall Street Journal

Photo by Adrian Sampson.