The book "The Vanishing Billionaires" embodies the full efforts of two authors, Victor Haghani and James White. They have devoted their entire lives to exploring a perplexing financial puzzle: why those who possess vast wealth ultimately fail to retain their substantial assets, becoming "vanishing billionaires."
Victor's personal experiences, like his deep motivation for diving into academic exploration, are profound. He was a founding partner of the renowned hedge fund Long-Term Capital Management (LTCM). During his brief and turbulent time at LTCM, he witnessed how even a group of high-IQ individuals, including two Nobel Prize winners, could face business failure due to fatal errors in risk decisions, which led him to lose most of his liquid wealth. This "life-changing experience" prompted him to deeply question and revise his existing understanding of the market and investment.
Victor and James realized that many people, including past financial tycoons like the Vanderbilt family, failed not because of bad market conditions, but because they consistently made poor financial decisions. They found that the financial industry and media often focus almost entirely on "what to buy or sell" (What), while the truly critical and potentially devastating decision is "how much to invest" (How Much, i.e., position size). If the investment choice is wrong but the position size is reasonable, the loss will not be catastrophic; however, if an excellent investment is chosen but too much is invested, even normal fluctuations can lead to bankruptcy.
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