Black Swan Event

A black swan event is a rare, extreme, and largely unpredictable occurrence with severe consequences, a term popularized by Nassim Nicholas Taleb, that is only widely understood as significant in hindsight. The 2008 financial crisis and the initial 2020 pandemic market crash are commonly cited examples.

The practical lesson drawn from the concept is not to try to predict the next black swan specifically (by definition, that is nearly impossible), but to build a portfolio and a plan robust enough to survive one, since history shows they arrive more often than standard risk models tend to assume.