Finance, Risks and Society

Recently, there was an issue/debate pertaining to the Dress code that needs to be followed by girls in Colleges in Tamilnadu, India. The contention was that modern/fashionable dresses were instigating people of the opposite sex to cross the acceptable norms of behavior. That goes to show the sorry state of affairs where, our actions/values are based on what the other person says or wears. It only gives a frivolous justification for promiscous behavior.

Now, coming to the connection between, dress code, risks and finance...

When we want to make an investment decision, we have various options laid before us and we are expected to make the decision based on our risk taking appetite and hence the expected returns from our investments. For example, stock markets have traditionally returned superior returns while the trade off has been an unexpected volatility which translates into an unpredicatable risk. In short, stocks go with the maxim : "Fortune favours the brave"...

Risk always translates into a greater exposure for uncertainty. If you invest your money in Government bonds, your money is safe while the returns are also commensurately less. Its akin to a girl wearing a conservative dress like saree/salwar kameez. While there is a greater chance of the girl reaching her destination safely, she doesnt feel very happy projecting herself a very staid,old and dull person. On the contrary, if she decides to wear a skimpy skirt, she indirectly increases her risk exposure and puts herself at greater risk. If she manages to overcome the risk and reach safely, her returns or outcome from such a event are, so to say are more, as she gets a joy in informing the world about her contemporary tastes.