Howard Marks on risk

People want to be able to take the concept of risk and use it in a formula to do computations.  The only number that’s available to use as a proxy for risk is volatility, or the standard deviation of prices or returns.  That’s not what risk is.  Risk is the probability of losing money, [but] there is no number you can use for that because there’s no place you can look to find out what the probability of a bad outcome is today or what it was six months ago when you made the investment.  So, you can be quantitative but not accurate, or accurate but not quantitative.  You can’t do both.

~ Howard Marks, "Howard Marks on Trump, Risk, Inflation, and Tariffs," Barron's, November 9, 2024