INVESTMENT AND PORTFOLIO MANAGEMENT

MODULE 3
Activities: Write a reaction paper with the following questions as a guide:
1. Summarize the film in one sentence.
The film is based on a true story about the 2008 financial crisis, wherein the housing
market skyrocketed and crashed.

2. Who do you think was the real hero/es of the film? Explain why.
In my viewpoint, the real hero in this film is Dr. Michael "Mike" Burry, because
without his prediction, no one would be aware that housing markets might collapse.
In this potential problem, he used a smart strategy by swapping credit in mortgage
bonds. This strategy appears to be a diminution on his part, but it is actually an
investment that will be of great use to him in the future.

3. Which do you think was the main reason for the economic collapse, the credit
default swap (CDS) or the collateralized debt obligation (CDO)? Why?
The primary cause of the economic collapse appears to be collateralized debt
obligations (CDOs). The financial market becomes enthralled by the fact that
housing markets have skyrocketed, leading to the conclusion that they don't seem to
care who is interested in the market; as long as people are interested, they'll accept
it. People are not paying their mortgages as a result of this carelessness, and
housing prices are falling, which has brought a negative effect on the financial
market sector.

4. What is/are the main lesson/s to be taken from the film. Explain briefly.

Everything has an end, so use what you have now wisely while keeping the
future in mind. Because nothing is constant in this world, it is better to have some
backup plans in case of a potential setback.