Risk Smile

by Rick Nason, PhD, CFA

Partner, RSD Solutions Inc.

www.rsdsolutions.com

info@rsdsolutions.com

I bet when you clicked on this link you thought there would be something about volatility smiles.  Probably not for a couple of weeks though (that is when I discuss that topic with my MBA Derivatives class).  Nope, this blog is about smiling.  That is the thing that you do when you are happy and cheerful.

In this blog I would like to ask you if your risk department, or your risk consultants make you smile.  Do they?  If you are a risk manager, or a risk consultant, do you make other people in the organization smile?  That is, while you are doing your job.

I think that risk managers should be making people smile.  Risk management is about getting things done in a prudent manner.  Risk management is about creating peace of mind.  Risk management is about creating opportunities.  Risk management is about increasing the probability and magnitude of good risk events happening (while decreasing the probability and severity of bad risk events happening).  All of these are good things.  Good things make people smile.  (….with apologies to Martha Stewart).