This podcast episode by Howard Marks discusses the indispensable role of risk in investing, drawing analogies from chess and backgammon. Marks explains different types of risk ("sham" vs. "real" sacrifices) and argues that avoiding risk entirely is itself a significant risk, leading to potentially insufficient returns. He uses examples from chess grandmasters and quotes from sports figures to illustrate the necessity of calculated risk-taking for achieving superior investment results. The episode concludes by emphasizing that while risk is essential, it must be managed skillfully and intelligently, not recklessly.
