Long-Term Capital Management, LP (LTCM) was in business participation in trade strategies for using market pricing discrepancies. Because the firm employed strategies to make money over a long horizon - from six months to two years or more - it took a long time - the time the funding structure is designed to allow it to withstand short-term market fluctuations. In many of its transactions, the firm was actually seller liquidity. LTCM typically seek to hedge risks - the impact of the components of their positions, which were not expected to add more value portfolio and increase value-added component of its risk exposure by borrowing to increase the size of their positions. Position of the Fund were diversified across many markets. This case is set to end in August 1998. LTCM fund was down nearly 40% from 1998, with most of the losses that have occurred in recent weeks. LTCM was a measure of liquidity fund and consider alternative courses of action. Possible options included trying to shrink rapidly, many fund positions and try to raise additional capital. "Hide
by Andre F. Perold Source: Harvard Business School 13 pages. Publication Date: November 5, 1999. Prod. #: 200009-PDF-ENG
Related Case Solutions & Analyses:
Governance and Talent Management in a Professional Services Firm
The Bottom-line Benefits of Ethics Code Commitment
Lessons from Pharmaceutical Product Litigation: Merck and the Vioxx Withdrawal Cona & McDarby vs. Merck Video Supplement
ATH MicroTechnologies: Making the Numbers
Critical Competitive Strategy Issues Every Entrepreneur Should Consider Before Going into Business
From Plague to Paradigm: Designing Sustainable Retail Environments
Gary Rodkin at Pepsi-Cola North America (B)
The Rise and Fall of Iridium
Governance Reform at MCI
KPMG Forensic: Money Laundering at Agnes Insurance
