I am inherently risk averse. I'm the guy who maxes out his life insurance coverage and takes out health insurance with the smallest deductible and highest coverage level. However, over the last few years I have become much more risk tolerant. This is mainly due to investing in the stock market. I first began investing in early 2020 when the market bottomed due to the impact and uncertainty of the COVID-19 pandemic. At the time, I thought of the Warren Buffet quote, "be fearful when others are greedy and greedy when others are fearful." This was a great time to get into the market. However, my inherent aversion to risk limited my ability to maximize my gains. Sure, I bought at the right time, but my fear of loss led me to sell too soon and miss out on significant earnings. I still made some money but could have done much better if I had been more risk tolerant. Oh well, hindsight is 20/20. Overall, I am thankful for the experience because it taught me about the necessity of being tolerant to some degree of risk if you want to truly be successful in investing.

In terms of my profession, I would say that my aversion to risk makes me a better nurse. I try to be diligent and proactive in the care I provide my patients. Much of this is due to the fact that I'm trying to mitigate risk. The fact of the matter is that bad outcomes happen. It's inevitable in healthcare. If you are in the profession long enough you will have a patient that codes or has some other adverse event that you will have to react to. If you are proactive and diligent in the care you provide, you might not be able to completely prevent such events from happening but you likely will be able to mitigate their impact and improve the outcome.

What is your personal level of risk tolerance? Give a detailed example. What specifically would make you consider taking on more risk? How do you think this affects to the decisions you make in your occupation?

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My personal level of risk tolerance has evolved over time In the past I was extremely risk averse in ... View the full answer