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on 21 February 2016
The contents of the book could be summarized on a A4 or less: 1) stock price changes dont follow a normal/gaussian distribution 2) stock prices show significant autocorrelation, which is incompatible with EMH 3) a lot of random obscure history facts. There, saved you from buying the book.
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on 17 December 2011
I was left feeling that the great man, as well as going on a huge ego trip, was rather bitter about, as he saw it, not getting the recognition for work that he did in his life which did not have any particular real world use, particularly when those that did similar things later, or at the same time, did get recognition. He then lambastes, with justification, traditional economic theory but without any suggestion of how his methods may be applied in their place. The issue for me with Mandelbrot is you are left with a sense of "so what, how is this useful and how is it applied?", none of which is put forward. You can't really cover the subject of fractal Chaos without knowing something of Mandelbrot, however I have been left without any greater understanding of the subject and its application having read this book than I did before. I much prefer Chaos: Making a New Science as an introduction that actually tells you something useful and following on from that Against the Gods: The Remarkable Story of Risk as two books that give a far better base from which to develop working market understanding which can be applied.
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on 6 August 2011
This is a great read (if you like this sort of thing). Not too mathematical (there's a bit of maths in the appendices if you want though), anecdotal enough to make the (relatively dry) subject matter more interesting. A great insight into how one of the more brilliant thinkers of our time operates, and a huge nail in the coffin of the 'efficient market hypothesis', if there were ever any doubt that that theory was discredited. Does put the EMH nicely into context, too - it could only ever really be a working hypothesis for rough and ready financial modelling in very limited circumstances, whereas the mistake has been to try to extend EMH to become almost a mantra covering all markets all of the time.
The way Mandelbrot describes fractal modelling it seems a promising basis for all sorts of further research. Very interesting concluding chapter on practical applications of his theory and its derivatives ('In the Lab').
As another reviewer says, this is essentially a 'single point' book, with the point being made repeatedly and in a number of ways. For me, however, that did not detract: the point has sufficient depth to warrant the analysis and exploration undertaken.
Recommended.
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on 10 April 2018
Mandelbrot is not an easy scientist to admire. Lack of peer support mean he is still on the list of outliers, although that’s probably apt, given his findings. That said, he defies accepted knowledge and challenges literally every economic concept in this book. While giving examples of how his thinking applies in other fields. Totally engrossing and utterly challenging.
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on 21 September 2012
Mandelbrot lends his name to this pop sci title which elaborates on how fractal theory can be applied to modelling financial markets. As someone with no background in economics, I found this book really interesting and thankfully it provides just about enough explanation to make sense of the technical jargon. Don't be put off if you can't tell a stock option from a swap, no prior knowledge is needed to enjoy this book. Mandelbrot stresses that much of the existing economic theory is based on models using over-simplified assumptions, with the overuse of the normal distribution seeming to particularly grind the author's gears.

While I expect most of the typing was done by RL Hudson, there is enough personal history and (at times) unadulterated bitterness to convince me that Mandelbrot played a strong hand in the writing of the book. He is honest about the controversy and mistrust of his pet theories, but also presents strong arguments of how and why they can be applied (wasting no time on modesty).

Overall, I'd recommend this book for outsiders interested in economics theory. Mandelbrot stresses that this is no investment guide and will not make you rich, but it's an enjoyable insight and if you own or would like to own any Mandelbrot set merchandise, this is probably the book for you.
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on 12 November 2010
Benoit B. Mandelbrot wrote this seminal book on risk and the understanding of it. I purchased mine when it was published, and was rereading when I heard he had died, what a loss RIP. Then I mislaid my book, I was distraught, it surfaced, phew! I won't go over & repeat all the other reviews as they have covered the subject comprehensively. Needless to say I cannot recommend this too highly whether your a life long student of investing or of economics or just curious. It's not an easy read, but persevere and you won't regret it. As the author wrote that the book won't make you rich but could save you from making catastrophic mistakes! We need more independent thinkers like him, who view their surroundings with curiosity and don't take `the standard model' as de rigueur!
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on 25 April 2015
A very interesting book indeed. I'm coming from a computer science background and everything made complete sense, although even non-technical people will grasp the take-away messages; after all the book has no equations so how hard can it be to understand it? The exposition is kinda slow but I guess that was necessary- the author first sets the background and then explains his main point. However, once you get there it does feel satisfying. Overall, a must for everyone who has some interest in finance and why modern theory doesn't represent the real world as well as some high fly finance people will make you believe.
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on 14 October 2011
Mandelbrot hammers fractal chaos geometry, which he invented, into modern finance theory and finds the latter wanting. His insight is that modern finance theory, in an attempt to appear scientific and so gain credibility, overlooks the jiggles and wiggles in real-life phenomenon especially tail risks. Result: colossal losses and economic disequilibria. Mandelbrot goes to great lengths (repeatedly) to demonstrate how computer generated fractal patterns imitate observed asset returns far better than charts generated from normally distributed algorithms. But he fails to take the logical next step and proffer practical techniques based on fractal geometry to manage risk more effectively.
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on 27 July 2013
Any finance professional will find much food for thought in this book. Mandelbrot re-frames the topic of risk and points to fundamental flaws in the current standard paradigm. There are a few annoying problems with the book, however, that keep me from giving it five stars: It circles and meanders a bit too much; Mandelbrot keeps telling us how great he is - we've already bought the book, no need to keep selling it; a few concrete applications of how to use his models in a prescriptive sense would have made them more relevant.
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on 21 August 2009
Mandelbrot presents fractal theory in an intuitive and non-mathematical way.
I would agree with Andrei's review below. He disputes the current methods of pricing and risk management while presenting some of his own ideas. This is good but there's no final solution. Some points could be more succinct and less anecdotal.

The book provides the starting point and Mandelbrot would like others to be serious and to take on the baton to find the perfect solution. Does perfection exist!? He thinks so.

I would recommend this book for those who want an intro to fractal finance but be prepared for a hard slog as you wish he'd get to the point.
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