Quant Funds and the August Meltdown

[ImBetterAtGolf]

What did it really say? Most of the quant funds are leveraged, but so is every bank and a vast number of other funds. Yes, there are some similarities between quant funds, and so too are there similarities within every class of fund. And, it's correct that they did have to deleverage when their equity shrank causing the ratio of assets/equity (leverage) to begin to rise too high. That's not much of an indictment; you could substitute almost any other type of fund here for "quant".

One thing that did happen was that on average these funds got more leveraged over the past few years, mostly because market volatility dropped. Otherwise, take out the references to "brainiacs", "MIT", "PhD", etc., and you don't have much. What am I missing?