For Mom and Pop Contents The Players 1 ALL IN 2 THE GODF ATHER: ED THORP 3 BEAT THE MARKET 4 THE VOLA TILITY SMILE 5 FOUR OF A KIND 6 THE WOLF 7 THE MONEY GRID 8 LIVING THE DREAM 9 “I KEEP MY FINGERS CROSSED FOR THE FUTURE” 10 THE AUGUST F ACTOR 11 THE DOOMSDA Y CLOCK 12 A FLAW 13 THE DEVIL ’S WORK 14 DARK POOLS Notes Glossary Acknowledgments The Players Peter Muller , outspokenly eccentric manager of Morgan Stanley’ s secretive hedge fund PDT. A whip-smart mathematician who occasionally took to New York’s subways to play his keyboard for commuters, in 2007 Muller had just returned to his hedge fund after a long sabbatical, with grand plans of expanding operations and juicing returns even further . Ken Griffin , tough-as-nails manager of Chicago hedge fund Citadel Investment Group, one of the largest and most successful funds in the world. In the years before the crash, Griffin’s indulgences included the purchase of an $80 million Jasper Johns painting and a Paris wedding at the Palace of V ersailles. Cliff Asness , sharp-tongued, hot-tempered founder of AQR Capital Management, a hedge fund with nearly $40 billion in assets under management at the time of the crash. Mere days before the crash, Asness’ s hedge fund was on the verge of filing the final papers for an initial public of fering. Boaz W einstein , chess “life master,” card counter , and powerful derivatives trader at Deutsche Bank, who built his internal hedge fund, Saba (Hebrew for “wise grandfather”), into one of the most powerful credit-trading funds on the planet, juggling $30 billion worth of positions. Jim Simons , the reclusive, highly secretive billionaire manager of Renaissance Technologies, the most successful hedge fund in history, whose mysterious investment techniques are driven by scientists poached from the fields of cryptoanalysis and computerized speech recognition. Ed Thorp , godfather of the quants. As a math professor in the 1950s, Thorp deployed his mathematical