[jreimers]

I am interested to know what the correlation is between uncertainty and returns. Are companies that succeed in highly uncertain spaces more profitable than those which succeed in well known markets? If you include companies that fail in uncertain spaces, is the average return still greater than those in more certain markets?

I would think yes, otherwise we would all be sticking with mining precious metals.

[nandemo]

Do you know about Modern Portfolio Theory and Capital Asset Pricing Model?

Granted, they don't refer to "uncertainty" exactly, but rather about quantifiable risk in the form of volatility. Also, the key word is "returns" (not exactly profits, but roughly the ratio of total profits over the initial investment). Basically, while investors have different levels of risk tolerance, a rational investor requires higher expected returns for higher expected risks.

While a lot of researchers have been questioning the validity of MPT and CAPM (because these e.g. rely on a lot of questionable assumptions), empirically the answer to your question seems to be "yes". Small cap stocks historically have higher returns than large cap stocks, and tech stocks have higher returns than utilities.