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Top Five Books to Read On Complexity In Finance

by Alan Daniel
, Top Five Books to Read On Complexity In Finance

As the cryptocurrency sector evolves and becomes more complex with synthetics assets, derivatives, and other financial instruments presented by projects, firms, and protocols, it is important to learn about the past and how complexity led to unseen demise.


What better way to learn about complexity than by reading?


Here are a few of the most compelling books to read on this concept.

When Genius Failed: The Rise and Fall of Long-Term Capital Management


This book by Roger Lowenstein is great for leisure reading on growth and decline of what was considered to be one of the most powerful hedge funds within the world, Long Term Capital Management (LTCM).

The book is certainly one to have on your reading list as it portrays vulnerabilities in mental models, the fallacies of genius, and lessons in risk. Check out this fascinating read on a high-flying hedge fund and its road to the end. Interesting characters in this book include John Meriwether, Warren Buffet, and a few Nobel Prize Winners.

The Education of a Speculator


This is one book to read in bullish markets and in bear markets as well, it may help investors and traders to keep their cool in both good times and bad. The author, Victor Niederhoffer, presents a compelling story on different aspects of life and how they relate to trading.

While the book may, at times, be excruciating, it does contain nuggets of wisdom and knowledge to absorb and utilize in trading and in decision making. A few of the key compelling topics within the book include coverage of the efficient market hypothesis and its faults, cycles, optimal trade execution, Darwinian ecosystems and modeling.

Conspiracy Of Fools


The Conspiracy of Fools reads like a compelling novel while detailing the culture and practices at Enron. Kurt Eichenwald provides the reader with in-depth facts while providing a storyline that keeps the reader engaged and informed. Lessons in this book include thinking for yourself, the importance of fiscal discipline and focusing on building a real company.

Fiasco: Blood in the Water on Wall Street


A fascinating read on the opacity of information and the consequences of lack of transparency in the financial world. Frank Portnoy writes a compelling book that details the world of derivatives from the perspective of young Morgan Stanley employee and his financial journey. The book provides key insights in concepts such as derivatives, asymmetrical information, and the need for an open, transparent and accessible financial system.

Power of Gold: The History Of An Obsession


The book details the rise of humanity’s obsession with gold. The author describes the progression of the universally desired element that cuts across nations, ethnic group, religions, and cultures. The Power of Gold is a fascinating read on ascribing value to a good and its effects. The book may be a bit verbose at times yet still provides the reader with nuggets of wisdom.

Have this book on your to-read list.

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