Probability versus Certainty

Amar Pandit , CFA , CFP

We all know the fact that we live in an uncertain world. The only certainty here is the uncertainty we all face (I have mentioned this several times before too). Today I would like to get your attention to the difference between probability and certainty. Because most people confuse probability with certainty. And many bullshitters use this confusion to their advantage.

A probability simply puts a number on how likely one possible future outcome is versus all the other possible future outcomes. 0.1% means a possible outcome has the lowest chance of occurring and 99.9% means that the possible outcome has the most chance.

Thus, there is a big difference between probability and certainty.



And it would pay you well to understand and remember this big difference.