GIGAMIND

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116 Life Lessons
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116.059 Life Lessons - Make your decisions as expected value calculations

Make your decisions as expected value calculations

This is the way I'd like to make all of my most important decisions.

"Think of every decision as a bet with a probability and a reward for being right and a probability and a penalty for being wrong. Normally a winning decision is one with a positive expected value, meaning that the reward times its probability of occurring is greater than the penalty times its probability of occurring, with the best decision being the one with the highest expected value."

  • Ray Dalio

Source:
  • Ray Dalio
Tags:
  • statistics
  • math
  • decision-making
  • {'relevant': None}