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Paul: 'Clearly a layman defines risk as the chance that a stock price will drop, while reward is the chance that the stock price will increase.'

Judging by the large quantities of 'lay' Fools jumping into options and other not so 'lay' investing tactics, I doubt we can still hang on to that old world definition of equity risk. Which I also happen to disagree with. For me, equity risk is the probability of permanent loss of capital. The 2008 meltdown being a case in point.

'most folks are not interested in volatility in and of itself.'

Which is passing strange, since most folks I've come across aim at beating a market index, e.g. the S&P 500. How exactly do they plan to do so if they ignore Beta, which is nothing but the variance of the equity relative to the variance of the market.

If they really wanted to ignore Beta, then their only choice is to invest in the market index itself!
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