In all industries there are people credited to being the best.
In design, the late Steve Jobs is credited to being the best in his industry. In boxing, Muhammad Ali was credited to being the best boxer of all time.
In U.S. politics, there is a consensus that Abraham Lincoln was the nation’s greatest President by every measure applied.
In the trading world, a number of traders are known worldwide for their skills. From Jesse Livermore to George Soros, we are sharing these tales of past and present traders who had to claw their way to the top.
Here, we will look at the five most famous traders of all time and cover a little bit about each trader and why they became so famous.
Jesse Livermore jumped into the stock market with incredible calculations at the age of 15, amassed huge profits, then lost them all, then mastered two massive crises and came out the other side while following his own rules, earning him the nickname “The Great bear of Wall Street.”
Livermore was born in 1877 in Shrewsbury, Massachusetts.
He is remembered for his incredible risk taking, his gregarious method of reading the potential moves in the stock market, derivatives and commodities, and for sustaining vast losses as well as rising to fortune.
He began his career having run away from home by carriage to escape a life of farming that his father had planned for him, instead choosing city life and finding work posting stock quotes at Paine Webber, a Boston stockbroker.
Livermore bought his first share at 15 and earned a profit of $3.12 from $5 after teaching himself about trends.
George Soros has an incredible backstory.
Born in Hungary in 1930 to Jewish parents, Soros survived the Holocaust and later fled the country when the Communists took power. He went on to become one of the richest men and one of the most famous philanthropists in the world.
Most day traders know him for his long and prolific career as a trader who famously “broke the Bank of England” in 1992. Soros made a huge bet against the British Pound, which earned him $1 billion in profit in just 24 hours.
Along with other currency speculators, he placed a bet against the bank’s ability to hold the line on the pound. He borrowed pounds, and then sold them, helping to push down the price of the currency on forex markets and ultimately forcing the UK to crash out of the European Exchange Rate Mechanism.
It was perhaps the quickest billion dollars anyone has ever made and one of the most famous trades ever taken, which later became known as “breaking the Bank of England”.
Soros is believed to have netted a total of about $44 billion through financial speculation. And he has used his fortune to fund thousands of human rights, democracy, health, and education projects.
There are only a handful of traders that can take a small amount of money and turn it into millions and Richard Dennis was one of them.
Known as the “Prince of the Pit”, Dennis is said to have borrowed $1,600 when he was around 23 years old and turned it into $200 million in about 10 years trading commodities. Even more interesting to note, he only traded $400 of the $1,600.
Not only did he achieve great success as a commodities trader, he also went on to launch the famous “Turtle Traders Group”. Using mini contracts, Dennis started to trade his own account at the Mid America Commodity Exchange.
He made a profit of $100,000 in 1973. The following year, he capitalized on a runway soybean market to earn $500,000 in profits. He became an outstanding millionaire at the end of year.
However, he incurred massive losses in the Black Monday stock market crash in 1987 and the .com bubble burst in 2000.
While he is famous for making and losing a lot of money, Dennis is also famous for something else – an experiment. He and his friend William Eckhardt recruited and trained traders a handful of men and women how to trade futures. These so-called Turtle Traders went on to make profits of $175 million in 4 years, according to a former student.
Paul Tudor Jones
Paul Tudor Jones thrust into the limelight in the 80s when he successfully predicted the 1987 stock market, as shown in the riveting one hour documentary called “Trader”.
The legendary trader was born in Memphis, Tennessee in 1954. His father ran a financial and legal trade newspaper. While he was in college, he used to write articles for the newspaper under the pseudonym, “Eagle Jones”.
Jones kicked off his journey in the finance business by trading cotton. He started trading on his own following 4 years of non-trading experience, made profits from his trades but got bored, and later hired people to trade for him so he would no longer get bored.
But the trade that shot him to fame came on Black Monday in 1987, when he made an estimated $100 million even as the Dow Jones Industrial Average plunged 22%.
He became a pioneer in the area of global macro investing and was a huge player in the meteoric growth of the hedge fund industry. He is also known for betting on currencies and interest rates.
He founded his hedge fund, Tudor Investment Corp, in 1980. The fund currently has around $21 billion in assets under management and he himself has an estimated net worth of nearly $5.8 Billion.
Super-trader John Paulson built a personal fortune worth $4.4 billion from managing other people’s money. Born in 1955, Paulson made his name and much of his money betting an enormous amount of cash against the U.S. housing market during the global financial crisis of 2007–2008.
Paulson bought insurance against defaults by subprime mortgages before the market collapse in 2007. He netted an estimated $20 billion on the collapse of the subprime mortgage market, dubbed the greatest trade ever.
However, his track record since that bet has been patchy at best. In the years following the financial crisis, Paulson struggled to match this success.
Failed bets on gold, healthcare and pharmaceuticals stocks caused investors to flee his hedge fund Paulson & Co, cutting its assets under management to $10 billion as of January 2020 from a high of $36 billion in 2011.
Earlier this year, Paulson announced the fund would stop managing money for outside clients and turn it into a family office. He launched the fund in 1994.