Official Review: The Nature of Risk by David X Martin

CCtheBrave · Post by **CCtheBrave** » 12 Oct 2015, 00:41

[Following is the official OnlineBookClub.org review of "The Nature of Risk" by David X Martin.]

3 out of 4 stars

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Have you ever imagined yourself to be a squirrel, hoarding all your food away in one tree, at the very edge of the forest? Or perhaps you consider yourself a solitary bear, never noticing what’s happening around you and confidently going about your business despite the mayhem that ensues all around you? You might even think of yourself as a deer, quietly following the herd and accepting guidance from a respected, trailblazing leader. If you can’t decide, or if none of these animals resonate with you, don’t worry, because in The Nature of Risk, a concise book on risk management, author David X. Martin will help you identify which animal profile you most-closely resemble. In his simple and quick parable, The Nature of Risk, Martin guides readers through the process of identifying their ‘risk management approach’ by using the well-known, and loved, fable of animals living within a forest.

Overall, The Nature of Risk is an instructive book meant to help readers understand the absolute basics of risk management. David Martin sets the scene by painting the image of a large forest that houses a diverse array of animals. Within the story, each animal represents a specific approach to risk management, while the forest itself is an allegory for the market. Throughout his book, Martin uses the example of a forest fire (which represents any potential pitfall in the market) to demonstrate that disaster and change can, and will, affect us all. The difference in how we are affected by these disasters, though, is a result of our differing, individual approaches to risk management. In this fable, David Martin uses a fox, bear, deer, squirrel, eagle, rat snake, turtle and otter to demonstrate several different comfort levels and approaches to risk.

Throughout the story, the author does a fantastic job providing clear and vivid examples of risk approaches via his animal archetypes. By using memorable imagery of forest fauna, Martin takes the very complicated subject of risk management and makes it accessible to individuals who are either inexperienced or overwhelmed with the topic themselves. One of the strongest aspects of the book, in fact, is the simplicity and memorability of the story line. Readers are left with a very clear idea of what it means to be aware of (1) potential risks within the market, (2) how their personal ideas of acceptable risk will affect their actions, and (3) probable outcomes of their choices.

Another strength of The Nature of Risk is the level of expertise and trust that the author brings to the table. David Martin has an extensive, professional background in risk management that enables him to easily break down the basics for readers. Martin not only gives readers the tools they need to identify their own risk management approach, but he also provides general tips and guidelines within the story that will resonate as sound advice to almost everyone. To illustrate, most chapters in The Nature of Risk end with a quick lesson on what types of pitfalls we should avoid, as well as which strategies work best for the general public. For example, Martin ends one of his chapters with a quick lesson about the difference between simply getting lucky and making an educated decision about risk when faced with disaster. Martin writes “…just because you didn’t get burned this time doesn’t mean you’re fireproof.”

Another interesting aspect of this book is the addition of illustrations within the text. Throughout the story, Martin includes modest, clean illustrations that reiterate the imagery he weaves into each chapter. The illustrations serve as a visual reminder that risk management doesn’t have to be a complicated, scary topic. Instead, with a little bit of background information and a clear understanding of one’s personal limits, it can easily become an accessible, manageable part of our lives. Readers looking to comfortably ‘dip their toes’ into risk management without getting bogged down by details or confusing terminology will surely appreciate this book.

The Nature of Risk, though, is not without fault. After finishing the book, it became clear that the author didn’t provide as much descriptive detail of the animal archetypes as he could have. Many readers would enjoy a bit more explanation of each animal’s behavior, if only to help them choose which risk management style they most closely identify with. Along that same line, the ending of the book was a bit abrupt, as well. Martin could have delved further into each archetype, as well as what types of decisions serve those archetypes best, without sacrificing the understandability of the topic. This book would also benefit from the inclusion of a list of further readings and resources for the audience, as well. Many readers, after completing this short book, will be left wanting more guidance about risk management and how to apply what they’ve learned.

In Summary, I rate The Nature of Risk, by David X. Martin, 3 out of 4 stars because it was a well-written and easy-to-read introduction to risk management, yet it left me looking for a bit more guidance at the end. After reading this book, and having little-to-no prior knowledge of risk management approaches, I now feel much more aware of my personal limits of acceptable risk, as well as more comfortable addressing risk management in my own life. I thoroughly enjoyed reading about a highly-technical topic via a well-known fable. I also appreciated the simple terminology and illustrations within. Besides wanting more guidance at the end of the book, or perhaps a suggested list of readings or resources provided by the author, this synopsis of risk management was well worth the read for anyone who is looking to gain a better understanding of risk vs. reward.

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The Nature of Risk
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