Black Swan

A black swan is an unpredictable, rare event with extreme consequences that is often rationalized with the benefit of hindsight. The concept was popularized by Nassim Nicholas Taleb in his 2007 book 'The Black Swan.' In financial markets, black swan events cause massive unexpected price movements and can wipe out portfolios that are not adequately hedged. Examples include the 2008 financial crisis, the COVID-19 market crash of 2020, and the collapse of major crypto exchanges.