Why a black swan?
Hundreds of years ago, people in the West thought that all swans were white, and every white swan they came across merely reinforced this perceived fact. But all it took was a sighting of a single black swan in Australia to blow the fact away.
The black swan theory is all about how a single piece of data can destroy an entire model or hypothesis, and how unstable and unpredictable economies and financial markets can be in light of the fact that we are never quite sure if, when or how our assumptions may be flawed or incomplete.
What is a black swan?
A Black Swan is a highly unlikely event, but has a great impact when it occurs. In the financial context, it usually refers to a crisis or a crash that normal financial or economic models do not predict. However, a Black Swan event can also be a good thing. The invention of the Internet, for example, is said to be a positive Black Swan.
Black Swan Capital’s objective is to enlighten Clients to see through the herd mentality of the markets that can so often lead to loss or even ruin, to highlight risk which sometimes is hidden, and to help Clients to understand and manage risk in order to maximise their chances of achieving financial stability and realising their objectives.