When Genius Failed: The Rise and Fall of Long-Term Capital Management

About the book

This hard to find 2001 paperback edition narrates the story of a once-highly-successful but now inexistent hedge fund named Long-Term Capital Management. Written by Roger Lowenstein, a financial journalist known more for his books about legendary investor Warren Buffett, the 250+ page book is an exciting journey to the financial markets.

Contents

This work details the beginning of Long-Term Capital Management or LTCM, its great rise, its climactic event, its catastrophic collapse, and its epilogue. It mentions who were the hedge fund managers, their qualifications, how they behaved throughout the many market events, how they succeeded at first, and what fatal mistakes they made that eventually led to the downfall of LTCM.

Review

I will not mention what mistakes the managers made but I can assure those who will read the book, that the types of mistakes mentioned in it are still being made today by many people, and not just hedge fund managers. 

From the mistakes the hedge fund managers made, valuable lessons and insights can be gleamed. This book is a good read because it places the mistake made in its proper context or situation. 

Difficulty Level = 2/5

Since this work is in narrative form, it is easy and even entertaining to read. To further appreciate this work though, one should be at least familiar with financial jargon. It is not a work of fiction and all the facts are straight. 

Personal Rating = 4.5/5

This is a must read for those who want to know more about a real-life example of what the finance world is like, and how complicated the markets can be. 

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