Sunday, February 28, 2010

Who are the Quants and Why May They Be Responsible for the Financial Crisis?

The Quants are discussed in Wall Street Journal article,  “The Minds Behind the Meltdown,” by Scott Patterson . They used mathematical models to estimate risk in the derivative market. Looking back it appears that these models may have underestimated the risks of the domino effect, how the failure of one security or investment house could bring down others.

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