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Risk and its sunnier sibling, reward, are an essential double act in the financial landscape. Safe investments tend not to offer much in the way of returns, while punts with a stratospheric upside are the ones that cash-strapped pensioners should avoid.

But the contrast with life outside the financial world is increasing. A growing health and safety culture gives the impression that risk is unnecessary and can be eliminated. But is that desirable? Or even possible?

“In a population, you need to have both risk-averse and risk-prone people,” says Jonathan Flint, a consultant psychiatrist at the Wellcome Trust Centre for Human Genetics in Oxford. “If you’re all made up of the risk averse, you die out. If you all go out and dice with death by predators, you probably also all die out.”

But he points out any decision can involve risk and anxiety. “You never know what the path not taken would have been,” he says.

Frederick Bieber, a forensic and medical geneticist who teaches at Harvard Medical School, says: “Probably in most decisions we make there is a risk/reward aspect.”

Bieber refers to a quote whose message is clear, even if its provenance is not: “Life is not measured by the number of breaths we take, but by the moments that take our breath away.”

Adventure sports feature on the list of playtime pursuits of many people who are used to high levels of financial risk in their jobs. Flying, car racing, piloting powerboats, riding fast motorcycles – all offer thrills but more danger than many people consider acceptable.

Bieber is well placed to talk about physical danger. An avid motorcyclist who is just about to start pilot training, he also is a keen climber. “There have been times when I’ve been on the end of a rope up a mountain, lead climbing with the only belay a hundred feet below,” he says. “This is obviously something I need.”

Others like their risk in even more aggressively sized chunks. Steve Fossett, the US businessman-turned-adventurer, faced off dangers in the skies and on the seas, but his reward was more than 100 records for speed and endurance – before he died on a routine flight in California in 2007.

UK property developer Steve Brooks nearly paid the highest price for his adventuring. He and another gifted pilot, former world rotary aerobatic champion Quentin Smith, survived a ditching in the icy waters off Antarctica in their pursuit of record-breaking helicopter flights to both the North and the South Pole.

Swiss airline pilot Yves Rossy gets his kicks by strapping a carbon-fibre wing festooned with small jet engines to his back and jumping out of a plane. The self-styled Fusion Man’s technique of freefalling and then lighting the jets to achieve sustained flight was able to get him across the English Channel in 2008. But at the end of last year, he had to abort his attempt to cross the Strait of Gibraltar, instead parachuting into the water. He is disarmingly sanguine about the risks, telling me it is all worth it in order to “be able to fly like a bird”.

Car racing carries a big slice of danger – as the health and safety warning signs at racing circuits testify.

Laura Tillett has embraced this since she started in karts at the age of 11. Seven years on, she is the first British woman to race in the World Karting Championships and has her sights set on competing in Formula One. Many drivers have followed a similar path to car racing’s pinnacle of risk and reward, including Lewis Hamilton.

And if risk is lacking from a person’s work or sporting hobbies, it tends to surface in other ways.

A scuba diver standing and showing off his equipment

One successful professional – let’s call her Cathy – eschews risk in much of her life. She does not drive, regards bicycles as dangerous and is prudent with her finances. Yet she gets her shot of risk from sex parties where the potential for exciting dalliances is high but the danger of sexual disease, and possibly emotional injury, is also heightened.

What drives people to take risks?

An extreme is the chance taking that can land people in jail – from traders who conceal their losses to burglars who stand to lose their freedom if they are caught. “A lot of criminality relates to what I would call a lack of ability to relate to delayed gratification,” says Bieber. But is that innate or learned? “Clearly there is a familial aspect to crime,” he says. “About 40-50 per cent of prison inmates in the US have a close relative in the prison system – usually a brother. But that’s probably social and economic, and it’s different from saying there’s a genetic cause. It’s what these people have learned from their upbringing, and it’s remarkable that so many of them get out of that life.”

But, he adds: “There are several genetic conditions where behaviour is part of the syndrome. We are at the beginning of understanding about how genes affect behaviour. And if you don’t think genes affect behaviour, then you’ve never studied dogs.”

Selective breeding by dog fanciers has in just 200 years produced deeply programmed traits in different breeds – from shepherding to bomb sniffing.

In humans, Bieber says, “there may not be a single gene, but in my view there are genetic differences that affect neurochemistry and our response to neuropeptides such as serotonin and endorphins”.

He cites the work of researchers at the Fred Hutchinson Cancer Research Centre in Seattle, who found a few years ago that mice with only a single copy of the neuroD2 neurodevelopmental gene were less able to form emotional memories, and therefore less likely to develop responses that minimised risk.

A more recent study of gambling behaviour among humans, reported in the journal Neuropsychopharmacology in 2009, found differences in the type of TPH2 gene, which affects serotonin availability, in subjects that correlated with their tendency to take risks.

More specifically, a study of financial risk taking by Northwestern University in Illinois for the first time linked specific variants of two genes that regulate dopamine and serotonin neurotransmission – 5-HTT LPR and DRD4 – to willingness to take risks in investment decisions. Researchers at the university’s psychology department and its Kellogg School of Management warned, though, that genetic make-up was only part of the story. Experience and culture are likely to comprise the larger part of reasons for making investment decisions.

The experience of one banker at Pictet, the Swiss private bank, backs that up. She says her clients’ behaviour has changed since the financial crisis. Now they are keener to take greater risks with their money – but they are not willing to gamble so much of it.

The clients want to make the most of the substantial returns they have seen in developing economies, though they are now more careful to hazard only what they feel comfortable about losing.

Since the financial crisis hit, institutions have also been taking radical steps to calculate risk more carefully. The Bank of England is looking to biological ecosystems for clues on how to make systems that will shrug off disaster while retaining stability.

Michael Stumpf, a professor of theoretical systems biology at Imperial College London who has been talking to the Bank, says: “If you are a bank, interacting with five other banks, and one defaults, then it may not be a problem. But if several other of the banks you interact with also interact with that failed bank, these things propagate like an avalanche. From a regulator’s standpoint, you want to stop the avalanche.”

Stumpf switched from statistical physics to biology ­“because I wanted something less predictable”, he says.

His background and current specialisation make him uniquely qualified to translate risk-management lessons from nature into man-made systems.

“How do you predict or guard against extreme events, taking lessons from biology?” he asks. “If you can put in the safeguards [that exist in nature], then you can have individual parts take risks and not expose the whole system.”

Stumpf and his wife, Zoë Laidlaw, a historian at the University of London’s Royal Holloway college, co-authored a paper some years back on bet hedging that found that in many cases “randomness can work better”, as he puts it. “Chicken pox and herpes exploit this.”

That adds to the problem of trying to minimise risk by predicting outcomes. But there is a way to tackle this. “If you admit all knowledge is uncertain but continually take predictions and gauge them against reality, and update them, then you will have a better chance than with a single model,” says Stumpf.

“When driving, for example, don’t just look at one map, which may be wrong. Look at lots of maps.”

The map of human behaviour encompasses a high number of actions that entail risk. Embracing that, as high flyers like Yves Rossy do, could well be the best way to maximise the rewards.

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