How do you reach a decision if you don’t have all the facts?

I'm Agree With Mr. Yaqoub                                    .

This is very difficult situation 

I think you have to use one or all of the following:

1-Gut feeling or The Sixth Sense.

2- "probability is merely a measurement of our ignorance of a certain event".

If don't you have all the facts available to make a decision then stick with the base-rate data. We humans try to predict exactly the outcome of a decision which leads to neglect of relevant base rates.  

Its basically measuring the risk isn't it? How much of a risk exists based on the information that you have and don't have? How does this risk impact the business and whats the probability. You will either get an accepted risk and make your decision.... or your decision will be to get more facts because you can't accept the risk.

You will first try to obtain the facts you need for taking your decision, and several techniques may be adopted to get the facts you need depending on the issue you are looking at and the stage you reached. If you can't get what you need, which is a very common situation, then your decision will be based on the facts you have in hands and possible analogues.     

Making Decisions Without All The Facts Recently, as I continue to analyze my investing habits, I’ve noticed a couple of things I was and was not doing. One aspect that I had always adhered to was to “always invest in businesses that you understand”. Some where along my investing journey, I slowly started to morph the philosophy to a new meaning; “don’t invest in anything unless you know everything”. Here is why I am wrong. Recently, as I continue to analyze my investing habits, I’ve noticed a couple of things I was and was not doing. One aspect that I had always adhered to was to “always invest in businesses that you understand”. Somewhere along my investing journey, I slowly started to morph the philosophy to a new meaning; “don’t invest in anything unless you know everything”. Here is why I am wrong. DOWNLOAD A PRINTABLE PDF OF THIS POST Click a button to download a PDF of this post now error Art Vs Science I’m sure you have all heard that investing is more of an art than science. Since we are valuing the future prospects of a business, where the future is always misty, murky and mystical, there is always a point in our research where we know that no amount of study and diligence will uncover all the facts. The80/20 Rule The80/20 is a nice ratio to remember. It may even be more helpful than the infamous PE. “By the numbers it means that80 percent of your outcomes come from20 percent of your inputs.” – Yaro Tying it in, it means that the first80% of the information comes from the first20% of research. Investing Without All The Information This brings me to my main point. How many of us have missed many no brainer opportunities because we were spending the remaining80% of our time to gather the last20% of information? When Buffett is asked about his worst investment ideas, his response usually refers to the missed opportunities, and boy am I feeling that these days. “High uncertainty is frequently accompanied by low prices. By the time uncertainty is resolved, prices are likely to have risen.” – Seth Klarman Quick Decisions Aren’t Always Bad Spending time on research is a good habit, but sometimes, we can make good quick decisions by quickly visiting the latest annual report and the research done by others. As with all things, I’m realizing that being fluid is important. One example is my experience with Dolby. I’ve missed my margin of safety price for Dolby twice because I was trying to wring out every piece

It is very complicated and risky situation if you have to make decision but dont have fact.

Observation is not backed by the reality but can be supplementary to the fact but carries a lot of risk to the decision making party.