What are the key steps for LTCM to earn very high returns from trading against small bond mispricing without being affected by market-wide interest rate changes?

First, buy illiquid assets; Second, short liquid assets at the same time. Third, use leverage.

First, short liquid assets; Second, borrow money from investment banks to return cash to investors when investors have redemption demands.

First, buy illiquid assets; Second, short liquid assets at the same time. Third, use leverage. Fourth, dynamic hedging.

First, buy illiquid assets; Second, hold those assets for the long term without trading.