In 1969, three economists seemed to have cracked the code for reducing risk on the stock market. By 1973, their pricing model had taken the financial world by storm, with traders and analysts thrilling at the promise of a risk-free future. By 1997, the two surviving economists received the Nobel Prize in Economics—and by 1998, the “unbeatable” formula had failed so spectacularly that the market was on the brink of collapse.
The Midas Formula: Trillion Dollar Bet follows the rise and meteoric fall of Long Term Capital Management (LTCM), the hedge fund founded by the two Nobel Prize winners Robert Merton and Myron Scholes along with legendary Salomon Brothers bond trader John Meriwether. It addresses the unpredictable nature of the stock market, the little inconsistencies that no mathematical formula can accurately take into account, and analyses whether the Black-Scholes model was doomed to fail from the beginning.
Full of history, insight, and hard-hitting truths, Trillion Dollar Bet breaks down the world of stock trading in practical and brutally honest way.