Book Notes · Markets & money
When Genius Failed (Roger Lowenstein)
Long-Term Capital Management had two Nobel laureates, Wall Street's best bond traders and four brilliant years, then lost $4.6 billion in under four months in 1998. Convergence trades, leverage, liquidity and why 'once in a million years' events happen.
Step 1 of 6 · Overview35 min read ·
Key idea
Prereqs: Duration & DV01; Swaps & SOFR; Position sizing. Next: Lords of Finance. Read: Roger Lowenstein, *When Genius Failed* (2000); see also Thorp (Great Minds) on overbetting.Next: 1. The dream team