The Financial Crisis Observatory (FCO) was founded at ETH Zurich under Prof. Didier Sornette's leadership as a response to the Great Financial Crisis and the widespread denial of its deep causes by experts. It aimed to demonstrate the feasibility of dynamic risk management and the ability to diagnose financial crises before they occur through pioneering research in market risks and instabilities.
With Prof. Sornette's retirement, ETH Zurich discontinues the Financial Crisis Observatory, marking the end of an era and the beginning of a new chapter. The original FCO site has since been retired by ETH, but its record of past work remains available in the Internet Archive.
View the archived ETH Zurich FCO siteThe Financial Crisis Observatory is reborn as a privately funded initiative, continuing the legacy of ETH Zurich's research and broadening its scope.
A method that uses LPPLS-based diagnostics to move a portfolio between hedged and unhedged states as crash risk changes, rather than carrying the constant cost of static insurance. In active development, together with the tooling needed to follow the signal inside the platform.
Translating the LPPLS indicators and scenario analysis into transparent, rule-based strategies — explicit entry and exit conditions derived from the signals, designed to be inspected and understood rather than taken on trust.
Extending the LPPLS model with machine-learning techniques to sharpen the diagnosis of market instabilities.
Applying Dragon-King methodology to strategies aimed specifically at the extreme, outsized market events that conventional risk models treat as impossible.
Expanding the guides, insights and worked examples that explain how the indicators are built, what they can show, and — just as importantly — where their limits lie.