What was the outcome of LTCM's collapse?
No impact
Wiped out investor value
Increased profits
Stable returns
Answer
The collapse of Long-Term Capital Management (LTCM) wiped out investor value, leaving them with significant financial losses. The hedge fund's risky investment strategies, including excessive leverage and complex derivatives, led to its downfall. The government's intervention to prevent a systemic financial crisis resulted in a bailout by a consortium of banks, but investors still faced substantial losses.
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