Chapter 3. Risk Management

As of today, there is no universal definition that would embrace all aspects of such a complex and versatile concept as “risk.” Actually, we must admit that millions of people—journalists, businessmen, scientists, professional investors, and financial services consumers who use this term daily—are still unable to give a strict and universal definition of the matter in question. This is especially striking considering that the notion of risk is the cornerstone of economics, finance, and many other related disciplines. Moreover, the same situation is observed in two other, undoubtedly fundamental, areas of scientific cognition of the material world: biology and physics. In biology, there is no universal definition of “species,” while this no....