Risk Modelling and its Myths

Nigel Da Costa Lewis

Imagine a world where all your time is spent making investment decisions efficiently and accurately. Imagine giving your focused attention to uncovering investment insights that create exceptional value for yourself and your organisation. Imagine hearing your boss announce to your team, “Dear team, our colleague has created so much value through their scientific methods that our investment process now leads our competitors by a decade or more. From now on they are the boss and we are doing things their way!” Imagine that you can uncover an amazing investment relationship, one that can be harvested to reap rewards for yourself, your organisation and benefit society for years to come. All over the world, and in many different ways, tens of thousands of people are doing exactly that through the power of statistical analysis. They are rewriting our understanding of the world in areas as diverse as epidemiology, environmental science, manufacturing, sports betting, market research and astronomy.

Since the late 19th and early 20th century, statistics has increasingly generated innovative ideas by those interested in the advancement of scientific knowledge. Among others, the Royal