FAIR glossary

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<h3 class="LexTKB__h3" dir="ltr" style="text-align: start;">The core outputs</h3><ul class="LexTKB__ul"><li value="1" class="LexTKB__listItem" style="text-align: start;">FAIR — Factor Analysis of Information Risk. The open quantitative cyber-risk model this tool implements (The Open Group).</li><li value="2" class="LexTKB__listItem" style="text-align: start;">ALE — Annualized Loss Expectancy. Total cyber loss over the time horizon, combining how often losses happen and how much they cost, under the chosen event model. The scenario's headline output.</li><li value="3" class="LexTKB__listItem" style="text-align: start;">LEC — Loss Exceedance Curve. For each loss level x, the probability that annual loss is at least x. The standard FAIR chart.</li><li value="4" class="LexTKB__listItem" style="text-align: start;">VaR — Value at Risk. The loss level exceeded only (1 − p)% of the time — e.g. VaR-95 is the p95 annual loss.</li><li value="5" class="LexTKB__listItem" style="text-align: start;">CVaR — Conditional Value at Risk. The average loss across the worst tail beyond a percentile — e.g. CVaR-95 is the mean of the worst 5% of simulated years. It says how bad the bad years are, not just where they begin.</li></ul><h3 class="LexTKB__h3" dir="ltr" style="text-align: start;">The frequency side (how often)</h3><ul class="LexTKB__ul"><li value="1" class="LexTKB__listItem" style="text-align: start;">LEF — Loss Event Frequency. How often a threat event becomes a loss event, per unit time. Decomposes to TEF × Vulnerability.</li><li value="2" class="LexTKB__listItem" style="text-align: start;">TEF — Threat Event Frequency. How often a threat actor takes an action against the asset. Decomposes to Contact Frequency × Probability of Action.</li><li value="3" class="LexTKB__listItem" style="text-align: start;">CF — Contact Frequency. How often a threat actor encounters or scans the asset.</li><li value="4" class="LexTKB__listItem" style="text-align: start;">PoA — Probability of Action. Given contact, how often the actor follows through with an attack attempt.</li><li value="5" class="LexTKB__listItem" style="text-align: start;">Vuln — Vulnerability. The probability that a threat event becomes a loss event. Decomposes to the probability that Threat Capability exceeds Resistance Strength.</li><li value="6" class="LexTKB__listItem" style="text-align: start;">TCap — Threat Capability. The skill, tools, and resources of the threat actor (0–100 typical scale).</li><li value="7" class="LexTKB__listItem" style="text-align: start;">RS — Resistance Strength. The strength of the asset's controls against the threat (0–100 typical scale).</li></ul><h3 class="LexTKB__h3" dir="ltr" style="text-align: start;">The magnitude side (how much)</h3><ul class="LexTKB__ul"><li value="1" class="LexTKB__listItem" style="text-align: start;">LM — Loss Magnitude. The cost per event. Decomposes to Primary Loss + Secondary Risk.</li><li value="2" class="LexTKB__listItem" style="text-align: start;">PLM — Primary Loss Magnitude. Direct loss from the event. May decompose into forms of loss (below).</li><li value="3" class="LexTKB__listItem" style="text-align: start;">Secondary Risk — loss from third-party reactions (regulators, customers, partners). Decomposes to SLEF × SLM.</li><li value="4" class="LexTKB__listItem" style="text-align: start;">SLEF — Secondary Loss Event Frequency. The probability that a primary event triggers third-party responses.</li><li value="5" class="LexTKB__listItem" style="text-align: start;">SLM — Secondary Loss Magnitude. The cost per secondary event. May decompose into forms of loss.</li></ul><h3 class="LexTKB__h3" dir="ltr" style="text-align: start;">The six forms of loss</h3>A loss magnitude can be broken into up to six categories:<ul class="LexTKB__ul"><li value="1" class="LexTKB__listItem" style="text-align: start;">Productivity — degraded or interrupted ability to produce: lost work hours, transactions, output.</li><li value="2" class="LexTKB__listItem" style="text-align: start;">Response — incident response: investigation, containment, recovery labor and tooling.</li><li value="3" class="LexTKB__listItem" style="text-align: start;">Replacement — replacing or repairing damaged assets: hardware, software, data restoration.</li><li value="4" class="LexTKB__listItem" style="text-align: start;">Competitive advantage — lost or compromised intellectual property and competitive position.</li><li value="5" class="LexTKB__listItem" style="text-align: start;">Fines &amp; judgments — regulatory fines, civil settlements, legal judgments.</li><li value="6" class="LexTKB__listItem" style="text-align: start;">Reputation — reputational damage: customer churn, brand impact, valuation effects.</li></ul><h3 class="LexTKB__h3" dir="ltr" style="text-align: start;">Data &amp; distribution terms</h3><ul class="LexTKB__ul"><li value="1" class="LexTKB__listItem" style="text-align: start;">SIP — Stochastic Information Packet. An array of pre-generated sample values (SIPmath 3.0) a factor can use instead of a shaped distribution — useful for vendor-provided or peer-reviewed data.</li><li value="2" class="LexTKB__listItem" style="text-align: start;">SLURP — Stochastic Library Unit with Relationships Preserved. A SIPmath library holding one or more SIPs that can share randomness (preserving correlations).</li><li value="3" class="LexTKB__listItem" style="text-align: start;">PERT / Lognormal / Beta / … — the distribution shapes you pick from when entering an estimate. PERT (low / most-likely / high) is the friendliest starting point; the picker suggests the shapes that fit each factor.</li></ul>

DecipherRisk CRQ turns a cyber-risk concern — "what could a ransomware hit on our EHR cost us?" — into a range of dollar outcomes with probabilities attached. You describe the risk in a few estimates; the tool runs thousands of simulated years and shows you the spread. Here's the whole loop.<h3 class="LexTKB__h3" dir="ltr" style="text-align: start;">1. Start a scenario</h3>From Scenarios, click New. You'll pick a starting template and, on your first scenario, a goal:<ul class="LexTKB__ul"><li value="1" class="LexTKB__listItem" style="text-align: start;">Just get a number — the leanest path. The editor stays minimal and you go straight to a result.</li><li value="2" class="LexTKB__listItem" style="text-align: start;">Build a model — opens the decomposition surfaces so you can break a risk into its parts.</li><li value="3" class="LexTKB__listItem" style="text-align: start;">Tune the math — reveals every advanced control for power users.</li></ul>Pick whichever matches your intent — it only sets what's shown by default; nothing is locked, and you can reveal more at any time.<h3 class="LexTKB__h3" dir="ltr" style="text-align: start;">2. Fill in your estimates</h3>A scenario is built from a small set of estimates. At the simplest, you give:<ul class="LexTKB__ul"><li value="1" class="LexTKB__listItem" style="text-align: start;">How often the loss event happens (its frequency — e.g. "about once every three years").</li><li value="2" class="LexTKB__listItem" style="text-align: start;">How much a single event costs (its magnitude — e.g. "somewhere between $200K and $2M, most likely $600K").</li></ul>You don't enter single numbers — you enter ranges, because nobody knows the exact figure. Each estimate is a distribution you shape with a few intuitive inputs (a low, a most-likely, and a high, for the common PERT distribution). A live preview shows the shape as you type.Not sure what a field means? Hover any underlined term for a plain-language definition, or see the <a href="https://file+.vscode-resource.vscode-cdn.net/d%3A/Development/Healthguard/hg-fair/docs/product-fruits/fair-glossary-faq.md" class="LexTKB__link">FAIR glossary</a>.<h3 class="LexTKB__h3" dir="ltr" style="text-align: start;">3. Run it</h3>Click Run. The tool simulates thousands of possible years using your estimates and shows the results. There's no Save button — your work is saved automatically as you go.<h3 class="LexTKB__h3" dir="ltr" style="text-align: start;">4. Read the headline</h3>The Results page opens on a headline figure and a loss exceedance curve — the core FAIR chart, showing the probability that your annual loss exceeds any given dollar amount. See the companion article, Reading your results.<h3 class="LexTKB__h3" dir="ltr" style="text-align: start;">That's the loop</h3>Define → Run → Read. Everything else — decomposing a factor into its drivers, adding risk controls to see their effect, attaching historical data — builds on this same loop. When you're ready to go deeper, the Build a model path and the <a href="https://file+.vscode-resource.vscode-cdn.net/d%3A/Development/Healthguard/hg-fair/docs/product-fruits/methodology-plain-language.md" class="LexTKB__link">How DecipherRisk CRQ works</a> article are your next stops.

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FAIR glossary