Black swan

The term “black swan” was popularized by the writer Nassim Nicholas Taleb in his book “The Black Swan: The Impact of the Highly Improbable”.

Its events are characterized by their extreme rarity, unpredictability, and significant impact. They are often events that were previously thought to be impossible or highly unlikely, for example:

• events in financial markets;

• 2008 financial crisis;
  

• the 9/11 terrorist attacks;
  

• the COVID-19 pandemic.

To manage the risks associated with black swan events, traders and investors can use a variety of strategies, including diversification, hedging, and risk management techniques. They can also use tools such as stop-loss orders and limit orders to limit their exposure to sudden market movements. By taking a cautious and informed approach to trading and investing, traders can manage the risks associated with black swan events and potentially profit from market volatility.