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Sep 10Doug Smith

Buzzword of the Week: Anti-Fragility

Sep 10Doug Smith

Anti-Fragile CFO Northern VirginiaTime to toughen up, according to this week’s buzzword from the Investopedia Lexicon. We all know what it means to be fragile. But what about anti-fragile?

Investopedia tells us that Anti-Fragility is a postulated antithesis to fragility where high-impact events or shocks can be beneficial. Anti-fragility is a concept developed by professor, former trader and former hedge fund manager Nassim Nicholas Taleb. Taleb coined the term “anti-fragility” because he thought the existing words used to describe the opposite of “fragility,” such as “robustness,” were inaccurate. Anti-fragility goes beyond robustness; it means that something does not merely withstand a shock but actually improves because of it.

For example, he describes an anti-fragile trading strategy as one that does not merely withstand a turbulent market but becomes more appealing under such conditions. Another example he gives is weight lifting, which trains muscles not just to withstand heavy lifting but to develop increased strength as the body repairs the muscle fiber tears. Taleb discusses anti-fragility in his books, “The Black Swan,” “Fooled By Randomness” and his 2012 book “Antifragility.”

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