Victor Niederhoffer: fearlessness, tenacity and squash

Victor Niederhofferhe is undoubtedly one of the most extraordinary and outstanding traders of our time. Despite the repeated collapse of his financial undertakings in 2007, he was and still is on the list of the great stockbrokers of the planet.

Victor Niederhoffer

Victor Niederhoffer: spokesman for sports

Victor Niederhoffer was born in 1946 in the famous Brooklyn borough of New York City to a policeman and a schoolteacher. The boy's grandfather was once a famous Wall Street gambler and even boasted an acquaintance with the legendary trader Jesse Livermore. Perhaps such hereditary roots predetermined Victor's fate in the future.

The boy's childhood hardly indicated future fame in the financial world. Rather, it was more about sports: Victor learned to play tennis early, and did it so well that he became the New York junior champion. This achievement earned him, among other things, a scholarship to Harvard University, during his studies at which Niederhoffer seriously interested in squash. So seriously, in fact, that four years later he won first place among American college students. Squash turned out to be an even more fruitful sport for Victor NiederhofferHe was more talented than tennis: devoid of athleticism and natural talent, he nevertheless, through persistence, determination and self-confidence, won the national championship five times, taking a well-deserved place in the Hall of Fame of the game.

While earning titles and prizes, Niederhoffer was simultaneously engaged in academic work in economics, and at one time taught finance at UCLA. His series of articles on market inefficiencies sparked outrage in the academic circles of the day with their unconventional approach and their challenge to conventional standards. But academic work did not tempt Victor, and he and his former Harvard colleagues founded the Niederhoffer Investment BankCross&Zeckhauser, which was engaged in buying up little-known companies and further reselling them to more famous companies. Already at that time Victor Niederhoffer became famous for his originality and assertiveness in dealing with customers.

Victor Niederhoffer: stepping on his own rake

In the early 1980s, Victor decided to go free-floating and start trading on the futures market. His company Niederhoffer Investments, Inc. quickly found its niche in trading futures и optionsHe became the leading financial consultant there. Niederhoffer's success attracted the attention of George Soros, who boldly entrusted him with the management of his investment fund of $100 million.

And it must be said, the famous multimillionaire did not go wrong: for eight years his manager was steadily bringing high profits. Soros highly appreciated Niederhoffer's financial abilities, even sending his own son to study and work with him.

By the mid-1990s Victor Niederhoffer was called the leading trader in the US futures market and one of the best fund managers. His book "Universities of a Stock Speculator" became a bestseller in 1997, combining his autobiographical recollections with practical advice for beginners in the stock market. However in 1997 the famous trader, floating on the crest of fame, was killed by his inherent love for risk. Niederhoffer lost his money on investments in assets of exotic Thailand, having invested significant funds in shares of local banks and lost $50 million on it. In addition his game on the rise of S&P 500 index without hedging positions on options was also a complete failure. As a result, in order to cover debts to his own broker, Victor, which lost a total of $130 million.He was forced to mortgage the house and sell at auction his accumulated collection of antique silver.

For a long time. Victor Niederhoffer was in a depressed state, disturbing those close to him with his depressive behavior. He was brought back to life by Bloomberg editor Laurel Kenner's offer to co-publish on markets, and Victor wrote that column for Bloomberg from 2000 to 2003. Moreover, their creative tandem continued with the co-authored and critically acclaimed book "The Practice of Stock Speculation."After that, it became marital.

Successes in his personal life were also projected onto Niederhoffer's affairs: one of his former investors entrusted him, despite the previous major setback, with his Matador fund, created for institutional investors in Europe and South Africa. At the same time Victor founded his own hedge fund Manchesteropen to all. The manager did equally well in both areas for 6 years, generating an average annual return of 40%. He seemed to have risen from the ashes reborn, and in 2006 he was even honored as the fund manager of the year. However, the same risk appetite again ruined Niederhoffer: in 2007 Matador incurred 75% losses and was shut down.

Who knows if a famous trader will find Victor Niederhoffer the strength to go out on the hunt a third time. One thing is known: he is still true to the ideas of fearlessness and optimism, believing that a time of general panic is the best time for a bold and determined investor.

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