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Training Camp • Cybersecurity Glossary
Quantitative risk assessment uses numerical measurements, often monetary, to evaluate risk objectively, calculating values like ALE from SLE and ARO.
Quantitative Definition: Quantitative risk assessment uses numerical measurements, often monetary, to evaluate risk objectively, calculating values like ALE from SLE and ARO.
Using numbers to measure something, usually monetary values. Quantitative risk assessment employs precise numerical measurements and statistical analysis to evaluate risk in objective, measurable terms, typically expressing impact in monetary values and likelihood as frequencies or probabilities. This approach provides concrete data for cost-benefit analysis and investment decisions. Quantitative methods are described in standards like NIST SP 800-30, ISO 27005, FAIR, and various financial frameworks. Organizations implement quantitative analysis through statistical modeling, Monte Carlo simulations, value-at-risk calculations, and historical data analysis. For example, a financial institution might perform a quantitative analysis of potential security incidents, calculating the Annual Loss Expectancy (ALE) for different threats by multiplying the Single Loss Expectancy (SLE) by the Annual Rate of Occurrence (ARO), enabling precise comparison of different security control investments. Related terms: Risk assessment, ALE, SLE, ARO, Value at Risk, Monte Carlo simulation, Expected value, Statistical analysis, Return on security investment (ROSI).
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