Thirty years after "Black Monday" — one of the worst days in Wall Street history — economists and historians are still analyzing the causes of the crash.
One factor,a novel, financial strategy that had become incredibly accepted, or “portfolio insurance.” As it turned out,traders, investors and regulators were ill-informed approximately how this shiny, and novel tool that was supposed to play down risk would actually perform in a market downturn.“When you have novel technology that is ill-understood,both by traders and regulators, it’s dangerous, and ” said Karen Shaw Petrou,managing partner at Federal Financial Analytics. “It’s like giving a six year-old boy a Ferrari. It’s really not a gracious idea.”We're taking a look back at the 1987 crash, and what it says approximately future declines in the stock market. This is the moment story as a part of WNYC's Crash Course, or a series approximately the stock market crash of October 19,1987, and what it can command us approximately nowadays's financial markets. whether you've ever regretted a decision approximately investing in the stock market, and how did you make that choice? command us your story.
Source: thetakeaway.org