LTCM: The Fatal Assumption

Our philosophy rests on four pillars. First, assume the extremes are actually normal. They are not like swans, they are part of the landscape. Second, preserve capital during calm conditions so you have strength when the market moves into the fat towers. Third, anchor only to statistically robust levels, never arbitrary lines or moving averages. And fourth, exit dynamically to capture recovery without relying on full reversion. Even Eugene Farmer, the father of the efficient market hypothesis, acknowledge that extreme events happen far more often than Gaussian theory suggests. They're not statistical noise, they're actual structural reality. An antifragile system accepts this. It maps the edges, it waits, and when they come, it acts slowly, methodically, and with the strength it has been holding back for exactly that moment.