Long Term Capital Management (LTCM) was a hedge fund founded in 1994 by John Meriwether that utilized quantitative models and leverage to profit from convergence trades. While initially successful, LTCM lost billions in 1998 during the Russian financial crisis as markets became volatile and liquidity dried up. To prevent systemic risk, the Federal Reserve orchestrated an emergency bailout. The crisis showed that highly leveraged positions are vulnerable to shifts in market liquidity and correlations between assets. Key lessons include incorporating liquidity as a risk factor, stress testing models, and relying more on judgment than purely quantitative analysis.
Collapse of Long Term Capital Management Dipti Chauhan
This presentation is about the collapse of LTCM. We studied how the collapse happened , strategies used by LTCM, the counter parties involved and who suffered the most. The project also gives some important lessons we learnt from this collapse.
Collapse Of Long Term Management (LTCM)- FIXED INCOME projectSaurabh Mittra
Hedge Fund, Introduction of LONG TERM CAPITAL MANAGEMENT, key members ,FOUNDER OF LTCM, nobel Laureates,strategies used , arbitrage models, rise of LTCM, fall of LTCM, returns of LTCM, fall of LTCM, causes of collapse, Swaps on swaps, Russia defaults, South east Asia crashes, factors affecting LTCM, counterparties of LTCM, LTCM in news, bailout of LTCM, FED intervene, Losers, after story of collapse, relevance to current crises and Causing U.S 2008 crises, lessons learned, types of risk and the references.
This presentation will give users a general overview of many aspects of the industry and its purpose, including:
• The benefits of hedge fund investing
• Who invests in hedge funds?
• Who regulates the hedge fund industry?
• The various strategies and types of hedge funds
• How do hedge funds generate returns for their investors
Learn more about the global hedge fund industry at: www.hedgefundfundamentals.com.
Collapse of Long Term Capital Management Dipti Chauhan
This presentation is about the collapse of LTCM. We studied how the collapse happened , strategies used by LTCM, the counter parties involved and who suffered the most. The project also gives some important lessons we learnt from this collapse.
Collapse Of Long Term Management (LTCM)- FIXED INCOME projectSaurabh Mittra
Hedge Fund, Introduction of LONG TERM CAPITAL MANAGEMENT, key members ,FOUNDER OF LTCM, nobel Laureates,strategies used , arbitrage models, rise of LTCM, fall of LTCM, returns of LTCM, fall of LTCM, causes of collapse, Swaps on swaps, Russia defaults, South east Asia crashes, factors affecting LTCM, counterparties of LTCM, LTCM in news, bailout of LTCM, FED intervene, Losers, after story of collapse, relevance to current crises and Causing U.S 2008 crises, lessons learned, types of risk and the references.
This presentation will give users a general overview of many aspects of the industry and its purpose, including:
• The benefits of hedge fund investing
• Who invests in hedge funds?
• Who regulates the hedge fund industry?
• The various strategies and types of hedge funds
• How do hedge funds generate returns for their investors
Learn more about the global hedge fund industry at: www.hedgefundfundamentals.com.
A situation in which the wealth of a nation or State or country experiences a sudden downturn brought on by a financial crisis. An economy facing an economic crisis will most likely experience a falling national output, a drying up of liquidity and inflation/deflation. An economic crisis can take the form of a recession or depression.
This presentation explains the events and causes that led to Global Financial Crisis in 2007-08, mainly focused on Collateralized Debt Obligations, Sub-Prime Mortgages, Credit Default Swaps and Housing Bubble.
An analysis of the Hilton hotels buyout by BlackstoneFrancesco Romeo
This presentation is about the Hilton hotels buyout. We analyze the case with different methods and our conclusion is that it was good deal for both Hilton and Blackstone.
Overview about The financial Crisis in 2008. The presentation with 4 main points: reasons, development (also including responses), and consequences.
We hope that this is an easy source of information for you to understand this crisis.
A situation in which the wealth of a nation or State or country experiences a sudden downturn brought on by a financial crisis. An economy facing an economic crisis will most likely experience a falling national output, a drying up of liquidity and inflation/deflation. An economic crisis can take the form of a recession or depression.
This presentation explains the events and causes that led to Global Financial Crisis in 2007-08, mainly focused on Collateralized Debt Obligations, Sub-Prime Mortgages, Credit Default Swaps and Housing Bubble.
An analysis of the Hilton hotels buyout by BlackstoneFrancesco Romeo
This presentation is about the Hilton hotels buyout. We analyze the case with different methods and our conclusion is that it was good deal for both Hilton and Blackstone.
Overview about The financial Crisis in 2008. The presentation with 4 main points: reasons, development (also including responses), and consequences.
We hope that this is an easy source of information for you to understand this crisis.
Liquidity Crises
A sudden and prolonged evaporation of both market and funding liquidity, with potentially serious consequences for the stability of the financial system and economy.
Economic and financial crises a fundamental analysis from Islamic financial...Shameel Sajjad
This presentation was made at Govt. Arts and Science College Malappuram and MES Arts and Science College, Kalathode, Chathamangalam, Kozhikode. The presentation was made in the seminars conducted with the sponsorship of Indian Association of Islamic Economics (IAFIE) as a part of its annual agenda for the year 2014 - 2015.
Short Selling: An Important Tool for Price Discovery and Liquidity in the Fin...HedgeFundFundamentals
The new presentation gives users valuable information about how hedge funds and other investors participate in the marketplace through short selling.
As the presentation describes, short selling generally means borrowing an asset (a security/stock, commodity futures contract, and corporate or sovereign bond) from a broker and selling it, with the understanding that it must later be bought back (hopefully at a lower price) and returned to the broker. The short seller then closes out the short position by buying equivalent securities on the open market, or by using an identical security it already owned, and returning the borrowed security to the lender.
As many news stories highlight short selling as a negative force in our markets, the new presentation explains how short selling can be a way for investors to communicate their view on the price of an asset. Short selling also provides many other critical benefits to investors, including:
• Risk management for hedging long positions and managing portfolio risk
• Increasing efficiency in the marketplace because the transactions inform the market with their evaluation of future stock, bond, or commodity price performance
• Lowering overpriced securities by encouraging better price discovery
• Providing liquidity by increasing the number of potential sellers in the market
Learn more about the global hedge fund industry at: www.hedgefundfundamentals.com.
US Economic Outlook - Being Decided - M Capital Group August 2021.pdfpchutichetpong
The U.S. economy is continuing its impressive recovery from the COVID-19 pandemic and not slowing down despite re-occurring bumps. The U.S. savings rate reached its highest ever recorded level at 34% in April 2020 and Americans seem ready to spend. The sectors that had been hurt the most by the pandemic specifically reduced consumer spending, like retail, leisure, hospitality, and travel, are now experiencing massive growth in revenue and job openings.
Could this growth lead to a “Roaring Twenties”? As quickly as the U.S. economy contracted, experiencing a 9.1% drop in economic output relative to the business cycle in Q2 2020, the largest in recorded history, it has rebounded beyond expectations. This surprising growth seems to be fueled by the U.S. government’s aggressive fiscal and monetary policies, and an increase in consumer spending as mobility restrictions are lifted. Unemployment rates between June 2020 and June 2021 decreased by 5.2%, while the demand for labor is increasing, coupled with increasing wages to incentivize Americans to rejoin the labor force. Schools and businesses are expected to fully reopen soon. In parallel, vaccination rates across the country and the world continue to rise, with full vaccination rates of 50% and 14.8% respectively.
However, it is not completely smooth sailing from here. According to M Capital Group, the main risks that threaten the continued growth of the U.S. economy are inflation, unsettled trade relations, and another wave of Covid-19 mutations that could shut down the world again. Have we learned from the past year of COVID-19 and adapted our economy accordingly?
“In order for the U.S. economy to continue growing, whether there is another wave or not, the U.S. needs to focus on diversifying supply chains, supporting business investment, and maintaining consumer spending,” says Grace Feeley, a research analyst at M Capital Group.
While the economic indicators are positive, the risks are coming closer to manifesting and threatening such growth. The new variants spreading throughout the world, Delta, Lambda, and Gamma, are vaccine-resistant and muddy the predictions made about the economy and health of the country. These variants bring back the feeling of uncertainty that has wreaked havoc not only on the stock market but the mindset of people around the world. MCG provides unique insight on how to mitigate these risks to possibly ensure a bright economic future.
what is the best method to sell pi coins in 2024DOT TECH
The best way to sell your pi coins safely is trading with an exchange..but since pi is not launched in any exchange, and second option is through a VERIFIED pi merchant.
Who is a pi merchant?
A pi merchant is someone who buys pi coins from miners and pioneers and resell them to Investors looking forward to hold massive amounts before mainnet launch in 2026.
I will leave the telegram contact of my personal pi merchant to trade pi coins with.
@Pi_vendor_247
how to sell pi coins on Bitmart crypto exchangeDOT TECH
Yes. Pi network coins can be exchanged but not on bitmart exchange. Because pi network is still in the enclosed mainnet. The only way pioneers are able to trade pi coins is by reselling the pi coins to pi verified merchants.
A verified merchant is someone who buys pi network coins and resell it to exchanges looking forward to hold till mainnet launch.
I will leave the telegram contact of my personal pi merchant to trade with.
@Pi_vendor_247
The secret way to sell pi coins effortlessly.DOT TECH
Well as we all know pi isn't launched yet. But you can still sell your pi coins effortlessly because some whales in China are interested in holding massive pi coins. And they are willing to pay good money for it. If you are interested in selling I will leave a contact for you. Just telegram this number below. I sold about 3000 pi coins to him and he paid me immediately.
Telegram: @Pi_vendor_247
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what is the future of Pi Network currency.DOT TECH
The future of the Pi cryptocurrency is uncertain, and its success will depend on several factors. Pi is a relatively new cryptocurrency that aims to be user-friendly and accessible to a wide audience. Here are a few key considerations for its future:
Message: @Pi_vendor_247 on telegram if u want to sell PI COINS.
1. Mainnet Launch: As of my last knowledge update in January 2022, Pi was still in the testnet phase. Its success will depend on a successful transition to a mainnet, where actual transactions can take place.
2. User Adoption: Pi's success will be closely tied to user adoption. The more users who join the network and actively participate, the stronger the ecosystem can become.
3. Utility and Use Cases: For a cryptocurrency to thrive, it must offer utility and practical use cases. The Pi team has talked about various applications, including peer-to-peer transactions, smart contracts, and more. The development and implementation of these features will be essential.
4. Regulatory Environment: The regulatory environment for cryptocurrencies is evolving globally. How Pi navigates and complies with regulations in various jurisdictions will significantly impact its future.
5. Technology Development: The Pi network must continue to develop and improve its technology, security, and scalability to compete with established cryptocurrencies.
6. Community Engagement: The Pi community plays a critical role in its future. Engaged users can help build trust and grow the network.
7. Monetization and Sustainability: The Pi team's monetization strategy, such as fees, partnerships, or other revenue sources, will affect its long-term sustainability.
It's essential to approach Pi or any new cryptocurrency with caution and conduct due diligence. Cryptocurrency investments involve risks, and potential rewards can be uncertain. The success and future of Pi will depend on the collective efforts of its team, community, and the broader cryptocurrency market dynamics. It's advisable to stay updated on Pi's development and follow any updates from the official Pi Network website or announcements from the team.
Introduction to Indian Financial System ()Avanish Goel
The financial system of a country is an important tool for economic development of the country, as it helps in creation of wealth by linking savings with investments.
It facilitates the flow of funds form the households (savers) to business firms (investors) to aid in wealth creation and development of both the parties
Turin Startup Ecosystem 2024 - Ricerca sulle Startup e il Sistema dell'Innov...Quotidiano Piemontese
Turin Startup Ecosystem 2024
Una ricerca de il Club degli Investitori, in collaborazione con ToTeM Torino Tech Map e con il supporto della ESCP Business School e di Growth Capital
Currently pi network is not tradable on binance or any other exchange because we are still in the enclosed mainnet.
Right now the only way to sell pi coins is by trading with a verified merchant.
What is a pi merchant?
A pi merchant is someone verified by pi network team and allowed to barter pi coins for goods and services.
Since pi network is not doing any pre-sale The only way exchanges like binance/huobi or crypto whales can get pi is by buying from miners. And a merchant stands in between the exchanges and the miners.
I will leave the telegram contact of my personal pi merchant. I and my friends has traded more than 6000pi coins successfully
Tele-gram
@Pi_vendor_247
The European Unemployment Puzzle: implications from population agingGRAPE
We study the link between the evolving age structure of the working population and unemployment. We build a large new Keynesian OLG model with a realistic age structure, labor market frictions, sticky prices, and aggregate shocks. Once calibrated to the European economy, we quantify the extent to which demographic changes over the last three decades have contributed to the decline of the unemployment rate. Our findings yield important implications for the future evolution of unemployment given the anticipated further aging of the working population in Europe. We also quantify the implications for optimal monetary policy: lowering inflation volatility becomes less costly in terms of GDP and unemployment volatility, which hints that optimal monetary policy may be more hawkish in an aging society. Finally, our results also propose a partial reversal of the European-US unemployment puzzle due to the fact that the share of young workers is expected to remain robust in the US.
how can I sell pi coins after successfully completing KYCDOT TECH
Pi coins is not launched yet in any exchange 💱 this means it's not swappable, the current pi displaying on coin market cap is the iou version of pi. And you can learn all about that on my previous post.
RIGHT NOW THE ONLY WAY you can sell pi coins is through verified pi merchants. A pi merchant is someone who buys pi coins and resell them to exchanges and crypto whales. Looking forward to hold massive quantities of pi coins before the mainnet launch.
This is because pi network is not doing any pre-sale or ico offerings, the only way to get my coins is from buying from miners. So a merchant facilitates the transactions between the miners and these exchanges holding pi.
I and my friends has sold more than 6000 pi coins successfully with this method. I will be happy to share the contact of my personal pi merchant. The one i trade with, if you have your own merchant you can trade with them. For those who are new.
Message: @Pi_vendor_247 on telegram.
I wouldn't advise you selling all percentage of the pi coins. Leave at least a before so its a win win during open mainnet. Have a nice day pioneers ♥️
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#pinetwork
2. Summary of Events
• In 1994, John Meriwether, the famed Salomon
Brothers bond trader, founded a hedge fund
called Long-Term Capital Management.
3. • Meriwether assembled an all-star team of
traders and academics in an attempt to create
a fund that would profit from the combination
of the academics' quantitative models and the
traders' market judgement and execution
capabilities.
4. • Sophisticated investors, including many large
investment banks, flocked to the fund,
investing $1.3 billion at inception.
5. • But four years later, at the end of September
1998, the fund had lost substantial amounts
of the investors' equity capital and was
teetering on the brink of default.
6. • To avoid the threat of a systemic crisis in the
world financial system, the Federal Reserve
orchestrated a $3.5 billion rescue package
from leading U.S. investment and commercial
banks.
• In exchange the participants received 90% of
LTCM's equity.
7. What was LTCM’s Strategy
• The basic principle of LTCM’s strategy was that
in the long term, the price of a security would
converge to its fair market value even though
there may be mispricing in the short term.
8. • LTCM utilized computer models to find
arbitrage opportunities between markets.
LTCM's central strategy was convergence
trades where securities were incorrectly
priced relative to one another. LTCM would
take long positions on the under priced
security and short positions on the overpriced
security.
9. • The strategy depended on exploiting deviations in
market value from fair value. And it depended on
"patient capital" -- shareholders and lenders who
believed that what mattered was fair value and
not market value. That is, because the fair values
were hedged, it didn't matter what happened to
market values in the short run — they would
converge to fair value over time. That was the
reason for the "Long Term" part of LTCM's name.
10. • A convergence trading strategy in the stock
markets, is a trade idea based on the principle
that when the price of a stock (or stock
portfolio) significantly deviates from its long-
term trend, it will sooner or later converge
(move back) back to its original trend. For
example, a trading strategy that generates a
buy signal at every dip of the stock price in a
general up trend is a convergence trading
strategy.
11. Convergence trades
• LTCM's main strategy was to make
convergence trades. These trades involved
finding securities that were mispriced relative
to one another, taking long positions in the
cheap ones and short positions in the rich
ones.
12. There were four main types of trade:
• Convergence among U.S., Japan, and
European sovereign bonds;
• Convergence among European sovereign
bonds;
• Convergence between on-the-run and off-
the-run U.S. government bonds;
• Long positions in emerging markets
sovereigns, hedged back to dollars.
13. • Because these differences in values were tiny,
the fund needed to take large and highly-
leveraged positions in order to make a
significant profit. At the beginning of 1998,
the fund had equity of $5 billion and had
borrowed over $125 billion — a leverage
factor of roughly thirty to one.
14. • LTCM's partners believed, on the basis of their
complex computer models, that the long and
short positions were highly correlated and so
the net risk was small.
15. What Does On-The-Run Treasuries
Mean?
• The most recently issued U.S. Treasury bond
or note of a particular maturity. These are the
opposite of "off-the-run treasuries".
16. What Does Sovereign Bond Mean?
• A debt security issued by a national
government within a given country and
denominated in a foreign currency.
17. LTCM ‘s positions
• LTCM had fixed income and equity positions.
The equity positions were a mix of index
spread trades, total return swaps and some
takeover positions.
18. Total return swap
• In a total return swap, the party receiving the total
return will receive any income generated by the asset
as well as benefit if the price of the asset appreciates
over the life of the swap.
• In return, the total return receiver must pay the owner
of the asset the set rate over the life of the swap.
• If the price of the assets falls over the swap's life, the
total return receiver will be required to pay the asset
owner the amount by which the asset has fallen in
price.
19. Example
• For example, two parties may enter into a
one-year total return swap where Party A
receives LIBOR + fixed margin (2%) and Party B
receives the total return of the S&P 500 on a
principal amount of $1 million. If LIBOR is
3.5% and the S&P 500 appreciates by 15%,
Party A will pay Party B 15% and will receive
5.5%. The payment will be netted at the end
of the swap with Party B receiving a payment
of $95,000 ($1 million x 15% - 5.5%).
20. What is a Takeover
• In business, a takeover is the purchase of one
company (the target) by another (the acquirer,
or bidder).
22. Flight to Liquidity
• The ultimate cause of the LTCM debacle was
the "flight to liquidity" across the global fixed
income markets.
• As Russia's troubles became deeper and
deeper, fixed-income portfolio managers
began to shift their assets to more liquid
assets.
23. • What LTCM had failed to account for is that a
substantial portion of its balance sheet was
exposed to a general change in the "price" of
liquidity. If liquidity became more valuable (as
it did following the crisis) its short positions
(rich assets) would increase in price relative to
its long positions (cheap assets).
• This was essentially a massive, unhedged
exposure to a single risk factor.
24. • Capital is only as patient as its least patient
provider. The fact is that lenders generally lose
their patience precisely when the funds need
them to keep it — in times of market crisis.
• As the case demonstrates, the lenders are the
first to get nervous when an external shock
hits.
25. • At that point, they begin to ask the fund manager
for market valuations, not models-based fair
valuations.
• This starts the fund along the downward spiral:
illiquid securities are marked-to-market; margin
calls are made; the illiquid securities must be
sold; more margin calls are made, and so on.
• In general, shareholders may provide patient
capital; but debt-holders do not.
26. • The only real source of capital that is patient
enough to take fluctuations in market values,
especially through crises, is equity capital. In
other words, you can take liquidity bets, but
you cannot leverage them much.
28. The lessons to be learned from this
crisis are
• Market values matter for leveraged
portfolios;
• Liquidity itself is a risk factor;
• Models must be stress-tested and combined
with judgement;
29. • LTCM fell victim to a flight to liquidity. This
phenomenon is common enough in capital
markets crises that it should be built into risk
models, either by introducing a new risk factor
— liquidity — or by including a flight to
liquidity in the stress testing.
30. • Another key lesson to be learnt from the LTCM
debacle is that even (or especially) the most
sophisticated financial models are subject to
model risk and parameter risk, and should
therefore be stress-tested and tempered with
judgement.
31. • According to the complex mathematical
models used by LTCM, the positions were low
risk. Judgement tells us that the key
assumption that the models depended on was
the high correlation between the long and
short positions.
32. • Certainly, recent history suggested that
correlations between corporate bonds of
different credit quality would move together (a
correlation of between 90-95% over a 2-year
horizon).
• During LTCM's crisis, however, this correlation
dropped to 80%.
• Stress-testing against this lower correlation might
have led LTCM to assume less leverage in taking
this bet.