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Strategies & Market Trends : Waiting for the big Kahuna

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To: William H Huebl who wrote (63479)4/15/2003 1:08:48 PM
From: Real Man  Read Replies (1) of 94695
 
Who knows. What that guy is writing about is something like 1987. It may happen to the dollar. Basically, when things deviate from 95% probability (2 sigmas or something), folks get scared, cause it means "we are getting da tail, and nobody knows where da tail will wind up". And when folks get scared, they sell. Not sure who came to rescue and saved these folks in the past, cause they were pretty scared. Probably the Fed?

Black-Scholes risk management is to Wall Street banks something like the Bible to Christians. Guess what? When Black-Scholes fails, it does so in a spectacular fashion. Rarely, but surely
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