Long-Term Capital Management (LTCM)

Long-Term Capital Management (LTCM) was a highly leveraged hedge fund founded in 1994 that used advanced mathematical models to identify and exploit small differences in global financial markets. It aimed to generate steady returns through complex strategies involving various assets like bonds and currencies. However, in 1998, a series of financial crises caused markets to move unpredictably, leading LTCM to incur massive losses and threatening the stability of the global financial system. The fund was ultimately bailed out by major banks and investors to prevent a broader financial crisis.