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    Ltc's positions were so large that they couldn't be liquidated, says bob greene. Greene: the commission argued that the very strategy we were advocating was largely responsible for the crash. He says the theory was that massive selling by portfolio insurers was responsible for most of the decline on October 19, 1987.

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    Ltc's positions were so large that they couldn't be liquidated, says bob greene. Greene: the commission argued that the very strategy we were advocating was largely responsible for the crash. He says the theory was that massive selling by portfolio insurers was responsible for most of the decline on October 19, 1987.

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    2 views1 page

    They Weren

    Uploaded by

    jazzymast
    Ltc's positions were so large that they couldn't be liquidated, says bob greene. Greene: the commission argued that the very strategy we were advocating was largely responsible for the crash. He says the theory was that massive selling by portfolio insurers was responsible for most of the decline on October 19, 1987.

    Copyright:

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    They werent fundamentally correlated, but the investments became correlated because of the activities of other traders in the

    market. So when things began to get bad, other investors began to sell out of the same strategies that LTCM was inand that caused the markets to move in the same direction, even though they werent fundamentally tied together. LTCMs positions were so large that they could not be liquidated. Similarly, the portfolios that were being insured in 1987 were so large that it was impossible to sell enough futures in such a short period of time to keep the portfolio insurance strategy on track. the commission argued that the very strategy we were advocating and following was largely responsible for the crash. The theory was that massive selling by portfolio insurers was responsible for most of the decline on October 19, 1987.

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