Risk Metrics on Andrew Sheves

SITREP for Friday, April 14, 2023

Fri, 14 Apr 2023 00:00:00 +0000

Welcome to the Friday, April 14, 2023

I’m on the road today, so it’s a Dragnet edition: just the key metrics today.

If this is your first time receiving this email, greetings! These SITREPS (situation reports) contain updates on critical events and essential metrics for you to use in your decision-making. There’s a guide here and a detailed white paper about the small data approach to risk assessment here.

On to the numbers.

A Small Data Approach to Risk Metrics: Risk Metrics White Paper

Wed, 14 Dec 2022 00:00:00 +0000

(Read more about the origins of the risk metrics project here and here)

The Risk Metrics White Paper

The risk metrics project has come into sharper focus over the last couple of weeks and I’m now comfortable with the foundation of the system and how to manage the data. I’m still a little unsure as to which metrics will be most useful but I have an initial set of 12 to start with and user feedback will be the best judge of what’s relevant.

Risk Metrics Project Update – November 2022

Tue, 08 Nov 2022 00:00:00 +0000

This post is an update on the risk metrics project I described a few weeks ago. You can read about the origin of the project and the intent here.

If you recall, the underlying metrics for the project had to meet the following criteria:

Broad, not narrow (meaning the metric has widespread effects)
Publicly available
Easily understandable
Updated frequently
Commonly used

Unfortunately, for a lot of the data I looked at, I could get four out of five criteria but often one remained out of reach. Usually, this was frequency as some macro-indicators are published in annual reports, not weekly or monthly. However, for a macro trend such as literacy rates, a year-on-year measurement is sufficient, which means that the final criteria could read regular or frequent.

A Data-Driven Approach to Risk Management – The Risk Metrics Project Background & Overview

Tue, 11 Oct 2022 00:00:00 +0000

Full disclosure: this is me working through an idea in public but, if you’ve been reading my stuff for a while, you’ll know that the blog and email are often me thinking out loud, trying out ideas to see what sticks.

In this case, it’s not a new idea but, instead, a rather old one. A 20-year-old one…

Data-Driven Risk Management

How this came about isn’t important, but since my first risk assessment, I’ve felt that there’s a need for some kind of simple math to underpin things and help with consistency. Eventually, that became the kind of thing you’ll have seen in the metrics and gradings work here.