Nobody ever talks about risk when the market is going up.  If they do, nobody listens.  It is only when the market is in a sustained decline that the topic of risk is raised.  When the market is in free-fall, fear predominates which makes a rational appraisal of risk impossible.  Unfortunately it does take a stiff market decline to get people to focus on their risk tolerances, because traditional methods like questionnaires are a poor substitute for the real thing.  When this market calms down it will provide investors an opportunity to calmly reassess their risk tolerances, but for now fear dominates.  In today’s screencast a look at real-time risk.

Items mentioned in the above screencast:

Fear sells.  (Phil Pearlman)

Do you have a model to measure risk?  (A Dash of Insight)

Darren Miller, “Find out your risk tolerance before the market finds it out for you.”  (Attitrade)

“You must ALWAYS know what you’re willing to risk before ever taking a trade – if not, DON’T TRADE”  (TraderFlorida)

Update:  Signs of fear on the stream.  (Chicago Sean)