Stalking the black swan : research and decision making in a world of extreme volatility / Kenneth A. Posner.

Format:

Book

Author/Creator:

Posner, Kenneth A.

Series:

Columbia Business School Publishing

Language:

English

Subjects (All):

Investment analysis.

Investments--Forecasting.

Investments.

Business cycles.

Recessions.

Physical Description:

1 online resource (284 p.)

Place of Publication:

New York : Columbia Business School Publishing, c2010.

Language Note:

English

Summary:

Kenneth A. Posner spent close to two decades as a Wall Street analyst, tracking the so-called "specialty finance" sector, which included controversial companies such as Countrywide, Fannie Mae, Freddie Mac, CIT, and MasterCard—many of which were caught in the subprime mortgage and capital markets crisis of 2007. While extreme volatility is nothing new in finance, the recent downturn caught many off guard, indicating that the traditional approach to decision making had let them down. Introducing a new framework for handling and evaluating extreme risk, Posner draws on years of experience to show how decision makers can best cope with the "Black Swans" of our time.Posner's shrewd assessment combines the classic fundamental research approach of Benjamin Graham and David Dodd with more recent developments in cognitive science, computational theory, and quantitative finance. He outlines a probabilistic approach to decision making that involves forecasting across a range of scenarios, and he explains how to balance confidence, react accurately to fast-breaking information, overcome information overload, zero in on the critical issues, penetrate the information asymmetry shielding corporate executives, and integrate the power of human intuition with sophisticated analytics. Emphasizing the computational resources we already have at our disposal—our computers and our minds—Posner offers a new track to decision making for analysts, investors, traders, corporate executives, risk managers, regulators, policymakers, journalists, and anyone who faces a world of extreme volatility.

Contents:

Forecasting in extreme environments

Thinking in probabilities

The balance between overconfidence and underconfidence, and the special risk of complex modeling

Fighting information overload with strategy

Making decisions in real time: how to react to new information without falling victim to cognitive dissonance

Mitigating information asymmetry

Mapping from simple ideas to complex analysis

The power and pitfalls of Monte Carlo modeling

Judgment.

Notes:

Description based upon print version of record.

Includes bibliographical references and index.

ISBN:

9786612796616

9781282796614

1282796615

9780231521673

0231521677

OCLC:

716238658