61 What is the difference between risk appetite and risk tolerance?

How do you explain how hungry you are for food? You use an amount of food - "I could eat a massive steak" or "I only want a small salad". The amount of food is not the same as the hunger, but it expresses it.
In the same way, we can use risk tolerance (or risk thresholds) as a measurable expression of our appetite for risk.

[msond]

Hi Dr. David Hillson, it would be great to hear your journey on your career development over the years, to hear some details and hurdles you’ve faced as a young Project Manager to where you are now. Thank you!

[natashatarapow]

Exactly what I thought while studying these terms for the CAPM exam, all these terms overlap a lot. I'm still confused on how I would answer some of these single selection questions. If they drop the definition of risk tolerance I feel like I could choose any of the terms and somehow be correct and incorrect at the same time lol.
Besides that, I'll probably follow your advice when using the term myself. Thanks!

[turkithemaster]

We could refer risk appetite to positive risks and risk tolerance to negative risks!

[kylelin]

This is surely a very confusing topic. I would like to think among the risk universe, we have risk capacity which is the upper limit of threshold an organization can take, and then risk appetite which is the level of risk an organization willing to pursue. In between would be the risk tolerance which is above the risk appetite but within the risk capacity, hence tolerable but not preferred or actively pursued. Is it appropriate to describe this way?

[mahmoudelsebaie]

We may need from you to give an example or case study and define from this example the risk Appetite, Tolerance and threshold

[harshdeepsingh]

Are Risk Capacity and Risk Tolerance, one and the same ?

[kodkid]

that did not help at all. Don't use the phrase, hmmmm... Ok, thanks.

[raymondphilip]

Risk appetite is the MINIMUM risk you can take
Risk tolerance is the MAXIMUM risk you can take