People and businesses who are risk-averse tend to be more cautious and careful in their decision-making, and may be more likely to choose options that are known or proven, even if those options may not provide the highest potential reward.

For example, an individual who is risk-averse might be more likely to choose a stable, secure job with a steady salary over a potentially more lucrative but riskier business venture. In investing, a risk-averse individual might prefer to put their money into low-risk, low-return investments such as government bonds rather than taking on the risk of investing in stocks or other higher-risk assets.

Another example of risk-averse behaviour might be choosing to drive a safe, reliable car rather than taking a chance on a newer, sportier model with less of a track record. In this case, the individual is weighing the potential risks (such as the possibility of mechanical issues or accidents) against the potential rewards (such as the enjoyment of driving a more exciting car) and deciding to prioritise minimizing the risks.