Glossary

Probability

How likely something is, from 0 (impossible) to 1 (certain), often written as a percentage.

In plain English

A probability of 0.5 is the same as 50%, or 'as likely as not'. Probabilities of separate events combine in ways our brains handle badly, which is why many results feel surprising when they are not.

Uncle Gary explains

The probability that Uncle Gary mentions 2008 at a family dinner is not technically 1. It is close enough that the cousins have a drinking game about it.

Why it matters for your money

Most bad money decisions come from misjudging probabilities: overrating rare big wins and underrating common small losses.

Where we tested it

Related terms

All glossary terms. Educational content, not financial advice.