And as my correspondent reminds us, the people who ran LTCM understood all about this sort of thing--indeed, those Nobel laureates got their prizes for, guess what, developing the modern theory of option pricing.
The theory of option pricing was discredited barely a year alter, causing the LTCM to fail.
mnli hypothesis: The theory of option pricing was discredited barely a year alter, causing the LTCM to fail. premise: And as my correspondent reminds us, the people who ran LTCM understood all about this sort of thing--indeed, those Nobel laureates got their prizes for, guess what, developing the modern theory of option pricing.