أنشئ حسابًا أو سجّل الدخول للانضمام إلى مجتمعك المهني.
A metaphore from Ramadan to explain this could be: You are hungry just before Iftar time and you see a table full of many kinds of food and you tell yourself that you are going to eat from each kind (appetite) ,but in practice there is a limit to what you can actually eat ( tolerance) otherwise you will stuff your stomach and end up in hospital ! Do you think this is a good way to explain the difference between the two terms for those who are not familiar with it ?
Risk Appetite in a simple term denotes the boundaries within which an organisation desires to consider it can factor the risk involved in any business decision.
Risk tolerance is occurs when there is a issue in which the enterprise has found the risk associated with it but the degree of risk is within the risk reward relationship.
The term ‘risk appetite’ is often used for forward-looking view of risk acceptance while ‘risk tolerance’ is often taken as the amount of risk an organization has accepted in the past.
I'd say:
Risk appetite is the sense of adventure
Risk tolerance is the fact of adventuring safety, some choose to be careful & realistic, others choose to be reckless
