Global Questions – Number 9: Scenario Analysis Framework

How To Be Better Informed About The Past, And The Potential Future(s)

Contents

1. Introduction

2. The Scenario Analysis Framework

3. The Reverse Scenario Analysis Framework

4. Concluding Remarks

---

Bitesize Edition

• Predicting is difficult. A good bettor doesn’t focus on who they believe is more likely to win or lose, they focus on mispricing. They take advantage of this mispricing, regardless of whether the bet is on somebody to win or somebody to lose.

• If we seek to use scenario analysis to explore potential futures, we need to locate mispricing. The process I go through to attempt to locate mispricings is the topic of today’s post in the Global Questions Series.

• As a bettor seeks discrepancies in the odds to take advantage of, where could prevailing narratives be supporting or opposing the true events? Could incorrect assumptions be leading to misinterpretation? Asking and exploring these questions doesn’t allow us to predict the future; nobody can do that. What this process does do is allow us to prepare for a range of outcomes that could be overlooked. Hence, scenario analysis is an opportunity to uncover hidden opportunities and risks in the sphere of geopolitics. Let’s find out more below.

---

Introduction

In assessing what nations want, sometimes it’s as simple as listening to what they say. Other times, we have to look deeper to determine what their true intentions could be. Israel’s Benjamin Netanyahu has done this frequently during the war in the Gaza Strip. You have to assess what is truth and what is only rhetoric. Geopolitical events have many inputs, and analysing them to gauge potential outputs is difficult. This is where my scenario analysis process comes into play.

---

The Scenario Analysis Framework

When these situations arise, I ask myself the following questions: