Financial risk assessment and medicine.

For today, I’d like to share with you a story that highlights the powers of perspective and how subjective, our perspectives are.

A lifetime ago, I was working as a financial advisor for a major financial institution in the unique city of Montreal in Quebec, Canada. The job itself was exciting the first two weeks, and then it fell into routine, as most jobs do. Retrospectively, I didn't like it because I was going through an existential crisis, personally, academically and professionally. Frankly, I had lost interest in the job, my performance, the goals set by my superiors, and I was just clocking in to clock out so I could get a paycheck because…well, bills must be paid, no matter what happens in this life. Yet, occasionally, I would interact with a wildly interesting person and that was just its own reward.

Then, one day, a gentleman comes in and asks to see a financial advisor. The lady at the front desk brought him to my small office and we sat down. The man was in his early forties, well groomed, affable and dressed casually, with sneakers, jeans, a sweater and his beige autumn coat. I got a good vibe from him and after exchanging the usual pleasantries, he told me he was a doctor, and he had come in to open a savings account and hopefully invest his money.

Right away, I went into the script I was taught to blurt out, hoping to get the answers that would allow me to offer him the right product or service. I asked the necessary questions about his goals, profession, income, purpose of the investments and his risk assessment. That last part made him frown. I stopped, intrigued, and waited for him to share what was on his mind. Then, he asked me, in a simple, concise and clear way, “What do you mean, “risk”?” . It was my turn to frown because I didn’t understand the reason for his befuddlement.

“Well, the risk you are willing to take on the money you’re investing because depending on the investment, you could lose a portion of your money and even all of it, if something were to happen to the market. I must understand your risk assessment profile after asking you a few questions, so I can suggest the right type of investment options that fit your profile.”

Funny enough, my almost rehearsed speech left him even more puzzled. I started to think I was the one who wasn’t clear. But he said something that threw me out of my comfort zone and left me befuddled. He simply said, “I do not understand financial risk, my friend. It doesn’t make sense to me!” I had to smile, and I apologized for doing so, which made him chuckle. He said he wasn’t taking offense to my smile. On the contrary, he was amused to see we weren’t understanding each other while we spoke the same damn language.

That’s when he explained his point of view. “Listen, I am a neurosurgeon. My definition of risk is life or death. When I operate on someone, I am dealing with life or death, or even possibly causing irreparable damage to someone’s body and mind. And the thing is I make enough money, plus I come from money, which means I can afford to lose tens, even hundreds of thousands of dollars and I would make that money back within a few years and invest again. Please do not think I am being arrogant, pompous or insensitive because I know very few people are fortunate enough to be in my situation. Bottom line is, I do not understand financial risk and I probably never will because I don’t even have the time or the will to learn about it. So, when I hear the market went up, down, financial crisis, and all that stuff, I understand its impact on people, but I am privileged enough that it hasn’t reached me, and it probably never will.”

I couldn’t help but smile and nod because of that level of honesty. The doctor was being candid without being arrogant, which was refreshingly amazing, since I hadn’t seen that level of honesty in all my years working in the banking system. Moreover, I somehow understood what he meant. That’s when I proposed putting him in touch with a wealth business manager, who will take care of everything and just give him the returns he needed without stressing about all the nonsense about market, capitalizations, shares, options, etc. The amount he wanted to invest was above my fiduciary capacities anyway. We parted ways amicably, and I never saw him again, much to my dismay because he was interesting as hell!

Moral of the story: we live on the same planet, but we sure as hell have different perspective on things. Medicine and finance are as opposite as fire and water or day and night. This bright man who saved lives every day and who came from a wealthy background was in a position where he didn’t care if he lost his money because money wasn’t an issue for him. I was a financial advisor at a major bank but getting $500 any time for an emergency was difficult at the time. He measured risk in life-or-death situations. He told me he had lost a few patients over the years and death always shook him. I sat in an office every day and input numbers into a computer. Two different worlds but same planet and life, as in we breathed the same air, saw the same sunrises and sunsets, drove on the same roads, probably went to the same university, but we couldn’t possibly see risk the same way. If you add our different upbringings, tax brackets, academic achievements, we couldn’t be more different, and that’s one of the reasons we couldn’t see risk the same way. Hell, I haven’t lost anyone in front of my eyes, while the heartbeat machine flat lines… You know what I mean?

Trying to explain to him how financial minds saw and understood financial risk would have been a waste of his precious time. I assume if he had tried to explain to me the ins and outs of craniectomy, spinal cord injuries, it would have been a bigger waste of time!

Perspective… A word that still surprises me to this day. And it is a word that reminds me to be humble because I don’t know everything. Life keeps proving me how little I know, or how my own perspective might not be the best or the most enlightened. Lastly, listening to others, so I could get a glimpse of their perspective, is incredibly rewarding.

Thanks, doc, for that lesson in perspective!

Thanks for reading me, my people!

Now smile and go on with your day!

Freeman Binagana