margin of safety
Room for error
A margin of safety is a buffer between what's required and what's provided—extra capacity to absorb the unexpected.
Engineers build bridges to hold more weight than anticipated; investors buy stocks below their calculated value.
The principle appears wherever failure would be costly: The medication dosage includes a wide margin of safety.
In all cases, it's the gap between the edge of disaster and where you've chosen to stand.
- bufferProtective intermediate space
- cushionStuffed fabric for comfort
- toleranceWillingness to accept difference
- leewayPermissible margin of freedom
- slackAbsence of tautness
risk · threshold · clearance · wiggle room · padding · insurance · rainy day fund · fallback · reserve · headroom · allowance · protection · redundancy · failsafe · breathing room · comfort zone · contingency · surplus
- investingstocks, stock, bonds, investing, investor
- toxicologytoxicology, poison, toxin, venom, toxicity
- mental modelsanchoring, confirmation bias, hindsight bias, Occam's razor, first principles
- cost accountingcost analysis, cost center, cost centers, cost control, cost accounting
- dose limitsLD50, lethal dose, toxic dose, maximum dose, tolerance level
margin of safetyexposure
State of being unprotected
vulnerability · danger zone · living on the edge · margin of error · hair's breadth
margin of safetyoverloaded
Burdened past capacity
maxed out · redlining · structural failure · zero tolerance · tight tolerances
margin of safetyovervaluation
Appraising too highly
overleveraged · overextended · negative equity · underwater · all-in
margin, margins, marginal, marginally, marginalize, marginalized, marginalization, safety, safe