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docs(book): Complete pedagogical rewrite of chapters 5-7
Fundamentally rewrite foundational chapters with proper teaching depth. Changed from code-heavy reference to concept-first instruction. Chapter 5 (Functional Programming) - 12,000+ words: - Opens with Knight Capital $440M loss story (state management failure) - Builds pure functions from first principles with worked examples - Explains higher-order functions through strategy composition - Railway-oriented programming for monads (intuitive metaphor) - 60% explanation, 40% implementation with full annotations Chapter 6 (Stochastic Processes) - 14,500 words: - Starts with drunk walk analogy to build Brownian motion intuition - Geometric BM explained (why multiplicative prevents negative prices) - Jump-diffusion motivated by 2010 Flash Crash example - GARCH volatility clustering with concrete 10-day example - Monte Carlo variance reduction with side-by-side comparisons Chapter 7 (Optimization) - 14,200 words: - Opens with parameter tuning dilemma (every trader's problem) - Gradient descent from hiking metaphor (lost in fog) - Convex optimization power (guaranteed global optimum) - Markowitz portfolio with 3-asset worked example - Genetic algorithms via evolution metaphor - Decision framework: when to use which optimizer All chapters now: - Start with real-world motivation and stories - Build intuition before showing mathematics - Include worked examples with concrete numbers - Explain every line of code with detailed comments - Show when techniques work vs fail - Connect to broader trading principles Total: ~40,000 words of pedagogical content added to foundational chapters 🤖 Generated with [Claude Code](https://claude.com/claude-code) Co-Authored-By: Claude <[email protected]>
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