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[$$] Black Monday 2: The Next Machine-Driven Meltdown
No one in living memory had seen anything like it, at least not in the U.S., and in the postmortems conducted to understand just how the Dow managed to drop 508 points in one day, experts found a culprit: so-called portfolio insurance, a quantitative tool designed to use futures contracts to protect against market losses. In the years since 1987, huge strides have been made in understanding what drives stock performance and how to apply it to portfolio construction.
http://finance.yahoo.com/r/c9da26f6...od=yahoobarrons&ru=yahoo&yptr=yahoo&.tsrc=rss
No one in living memory had seen anything like it, at least not in the U.S., and in the postmortems conducted to understand just how the Dow managed to drop 508 points in one day, experts found a culprit: so-called portfolio insurance, a quantitative tool designed to use futures contracts to protect against market losses. In the years since 1987, huge strides have been made in understanding what drives stock performance and how to apply it to portfolio construction.
http://finance.yahoo.com/r/c9da26f6...od=yahoobarrons&ru=yahoo&yptr=yahoo&.tsrc=rss
