The article discusses the challenge of predicting capital market behavior due to a lack of theory on risk conditions. Traditional models focus on certainty, but risk plays a big role in financial transactions. Current models of asset pricing rely on assumptions rather than solid theory. The market sets prices based on interest rates and risk premiums, with investors needing to take on more risk for higher returns. However, there is no clear theory on how risk affects asset prices. Diversification can reduce some risk, but the specific relevant risk component is not well understood.