The Greatest Trades of All Time
Since the formation of the New York Stock Exchange in 1792, players in various financial and commodities markets have made vast sums of money for themselves and investors. Some are able to keep their winning streak going perpetually, while others get lucky once, only to lose it all.
Regardless of whether you agree with their trades or not, the following list of people showcases some of the greatest trades in the business.
My book, "The Greatest Trades of All Time: Top Traders Making Big Profits from the Crash of 1929 to Today" (John Wiley & Sons, 2011), goes over in full detail how hedge fund managers and independent traders executed profitable trades that make folks with Scottrade accounts pale in comparison. These are their trades.
By Vince Veneziani, Author of "The Greatest Trades of All Times"
Posted July 12, 2011
10. George Soros: Pound for Pound
George Soros is known for many things, but his finest hour was back in 1992 when he predicted that Great Britain would devalue its currency and sold short $10 billion worth of pounds. Since then, he has been known as the "man who broke the Bank of England."
9. David Einhorn: A True Activist Investor
Einhorn is probably best known for two bets. One was against Allied Capital, which Einhorn destroyed during a speech at the Ira Sohn Investment Conference.
He also played an integral part in the downfall of Lehman Brothers, speaking publicly about his frustration with the company’s top management. Fun fact: Einhorn started his hedge fund Greenlight Capital with $900,000, with a great deal of it borrowed from his family.
8. Paul Tudor Jones: Calling The Crash
One of the most famous names in finance, Paul Tudor Jones is famous for his prediction of the 1987 stock market crash, which he bet against heavily. His use of technical analysis and charting can be seen in the widely bootlegged 1987 documentary "Trader." These days, Jones still runs his fund, Tudor Investment Corp., but is also heavily involved in philanthropy having founded the Robin Hood Foundation.
7. David Tepper: All Business
As the founder of Appaloosa Management, David Tepper is best known for his investments in distressed bonds and stocks. After the financial crisis, Tepper, like John Paulson, bought bank stocks low and sold them high, garnering him with billions of dollars in personal profits.
An avid philanthropist, Tepper donated $55 million to his alma mater, Carnegie Melon, moving the university to change the name of its business school to the David A. Tepper School of Business.
6. Marty Schwartz: The Pitbull
Marty Schwartz is one of the greatest traders alive today. He got his start on the American Stock Exchange floor and quickly moved into trading financial futures. Some of his best trades are chronicled in two books: the self-authored "Pitbull" and Jack Schwager’s "Market Wizards."
These days, Schwartz is a heavy hitter who trades oil futures in size at the CME.
5. John Arnold: The NatGas Blow Up
John Arnold made his name as an energy trader at Enron. He started his hedge fund, Centaurus Energy, after Enron shut down, initially funded with his own capital. Now a billionaire, one of Arnold’s most famous trades included buying up some of now-defunct Amaranth Advisors’ natural gas portfolio after Brian Hunter blew up the firm with a $6 billion loss.
4. Jesse Livermore: The Boy Plunger
One of the most famous traders to ever live, Jesse Livermore was notorious for making huge bets in the market and losing great sums of money in addition to creating massive profits for himself.
The semi-autographical book "Reminisces of a Stock Operator" remains one of the most widely read books in the industry today. A lot of people believe his investing methodologies still hold up in today’s markets.
3. John Paulson: Big Bets, Big Money
John Paulson’s Advantage Fund is hurting at the moment, but New York University Stern School of Business graduate banked hard when he invested in gold a few years ago, shortly before its meteoric rise into the $1,500-an-ounce level. He also shorted the housing market and bought up bank stocks when it wasn’t fashionable to do so.
2. Jim Chanos: Showing Enron Who's in Charge
Jim Chanos is a sleuth who enjoys poring over U.S. Securities and Exchange Commission filings to find discrepancies with certain companies. Known for selling stocks short, Chanos enjoyed pummeling companies, including Tyco, Boston Market and MCI Worldcom, into the ground. One of his biggest bets was shorting Enron after he found problems associated with their accounting methods, among other things.
1. Kyle Bass: Shorting Subprime
In 2007 and into 2008, Kyle Bass went from unknown portfolio manager to a popular contrarian investor when he bet against the housing market.
Shorting mortgage-backed securities seemed to work well for his fund, Hayman Capital.