Successful World Traders Part 2

John Arnold

The full name is John Douglas Arnold. Born in Dallas, USA, in 1974. He entered the University of Vanderbilt (Nashville) and graduated in just 3 years.

An immediate career as a trader began in 1995 at Enron Corporation as an ordinary trader. At that time, young John, who was 21 years old, used modern developments and technologies, such as Internet trading and algorithmic trading. Due to this, he managed to show excellent profitability from trade, and he was noticed by management. In Enron, he is entrusted with the sale of gas, in addition to oil, and then transferred to the position of manager.

In 2001, despite the flaring scandal to conceal losses through offshore companies, Arnold earned $ 750 million for the company, for which he received a prize of $ 8 million. In total, during his time at the corporation, he brought more than $ 1 billion in profit.

After the bankruptcy of Enron, John decides to “play big” and opens his own hedge fund called Centaurus Energy Advisors, LLC. In the company, he appoints himself as the general manager.

Thanks to his outstanding abilities, John managed to show the profitability of more than 150% and even 317% per annum, which is simply unbelievable for the energy sector. The year 2005 is considered unsuccessful for the company: then the profit was “only” 178%.

Unfortunately, but a fact – no one can always show such profit in financial markets. Centaurus Energy was no exception. In 2010, the fund showed the first loss of about 4%. In 2011 according to Forbes, earned 9%. Arnold realized that the terms of trade had changed and decided to close the fund. In 2012, his decision was implemented.

What is the secret of his professionalism? Nobody knows for sure. The most successful trader is a closed figure. He rarely appears in public, prefers privacy. Secular chronicles do not write about him, and he does not commit extravagant acts. John keeps his trade secret to himself.

Outstanding Achievements:

  1. According to Reuters, Centaurus Energy was “the most successful energy fund of all time.”
  2. The average yield on the hedge fund was 130% per annum.
  3. Together with his wife, he created the Laura and John Arnold Foundation, a charitable foundation with a capitalization of $ 2.2 billion. This is 2 times more than the American Red Cross.
  4. At 38, he retired. At the moment, Forbes estimates his fortune at $ 3.3 billion.

George Soros

Of course, one of the top forex traders. Born in 1930 in Hungary. By nationality – a Jew. The name given to him at birth is Gyorgy Schwartz. The family later changed their family name to the Hungarian Soros. This was done before the Second World War, and, as it soon turned out, not in vain. In general, his father was a very shrewd person and knew how to take risks. George himself in the future will repeatedly recall the lessons of his father.

In 1947, Soros left Hungary for England, London. In 1949 he enters The London School of Economics and Political Science and then graduates in 1952. Having wandered around London for some time without work, interrupted by casual earnings, George nevertheless finds his application at Singer and Freelander. So begins the career of a financier in 1953.

After 3 years, with a small amount in his hands, J. Soros, the future Forex trader, goes to America. There, thanks to his father’s help, he gets a job at a Wall Street brokerage firm. Soros creates his own financial instrument, combining stocks, bonds, and warrants, and begins to trade them. The operations that he carries out are international in nature.

In 1959, George transferred to the position of the analyst at the investment company Wertheim & Company. Having worked there until 1963, he throws arbitration.

Until 1966, Soros wrote a dissertation on the topic “The Heavy Burden of Consciousness”, temporarily not engaged in trade. After that, he joined Arnhold and S. Bleichroeder as the head of the research unit. It is worth noting that the company traded in the European stock markets.

In 1967, Soros heads two investment funds established by Arnhold and S. Bleichroeder with an initial capital of only $ 250 thousand. However, he managed to find investors and increase the capital of the funds to a significant amount.

After three years of successful work, George accumulates a substantial amount and creates his own hedge fund, calling it “Quantum”. Subsequently, Quantum will bring many billions of dollars to its creator, become world-famous and will be universally recognized for its incredible success in investing.

The most outstanding achievement of Soros is how he “threw” the Bank of England. This operation is associated with the British pound, so Soros is, in fact, a Forex trader. Just not quite ordinary.

Before the description of the operation, it is worth mentioning the name Druckenmiller. This is a young, 30-year-old manager, who was hired by George to manage the fund in 1992. Without Druckenmiller’s hint, there wouldn’t be anything.

History says that a couple of years before the decisive blow, the Quantum fund was quietly buying up the British currency and bonds of Great Britain. Thus managed to accumulate the amount of 3.9 billion pounds. But this didn’t seem enough for Soros, and his structures additionally took loans in US currency worth $ 3 billion and then converted this money into 1.6 billion. pounds. As a result, the scope for the operation amounted to 5.5 billion pounds.

So how was everything? September 9, the pound began to slowly fall. Druckenmiller suggested that Soros seize the moment and “help” the Briton to fall even lower. September 16 Soros sells all 5.5 billion pounds against the German mark. A collapse occurs. Other major players around the world are connecting to this collapse. The Central Bank of England is horrified and can do nothing about it – they are simply not ready for this. The pair GBP / DEM (pound / German mark) falls by 2.5% per day. GBP / USD is losing 4.3%. Soros earns $ 1 billion a day.

It is clear that not everything was so simple, and not only Soros drowned the British pound, but its infusion of 5.5 billion pounds was decisive. In addition, given the global nature of the economy, Quantum these days traded not only the “British”. There were operations with other currencies of European countries. All this together brought a colossal, record profit to the trading account.

A similar scenario was used by Soros and in 1997, the Financier played a game to lower the currencies of Indonesia, Malaysia, the Philippines, and Singapore. It caused in these countries a deep economic crisis and a return of the economy 15 years ago.

Of the failures, this is an investment of $ 1.875 billion in the Russian company Svyazinvest in 1997. A year later, the global financial crisis erupted, and stocks fell in price by more than 2 times. There were also losses of $ 300 million in shares of Internet companies in 1999.

The Quantum Foundation lasted until 2011 and then was closed.

Outstanding Achievements:

  1. Received daily income of $ 1 billion.
  2. He developed the “market reflexivity theory”, which states that future price forecasts are based not only on economic and political changes but also on psychological factors.
  3. Philanthropist founded the Open Society Institute charitable foundation. According to the BBC, as of September 2019, Soros’ charitable donations amounted to about 32 billion US dollars.
  4. He went down in history as a financier who changed the rules of the game in world currency markets.

How do the best traders in the world think?

In this article, we examined the most famous and influential traders. The list is far from complete but shows different approaches to the financial markets and to the Forex market in particular. We can talk about people who have achieved generally recognized successes for a long time, but let’s think about this: what unites the financiers considered above; how do famous traders think; why did they achieve such significant success?

Almost every investor described in this article had a difficult childhood and youth. Soros miraculously escaped death during the war, as he was a Jew in Hungary occupied by the Germans. Larry Williams traveled around his home state’s local libraries looking for bits of stock market information. Other successes did not come immediately either. Some of these people were certainly talented. But talent cannot be revealed without hard work on oneself.

Analyzing the nature of all these exchange trading gurus, we can conclude that they always knew their main goal and aspired to it. From youth, the best traders received knowledge from various sources: whether it be libraries, a father, or familiar cotton traders – it does not matter, the main thing is the end result.

Everyone, one way or another, had dizzying highs and painful falls. Someone left the world of investment for several years, saved up strength and then returned. Trading for such people was and remains the goal of life, for them, it is life itself.

Summing up, one thing is for sure: without proper perseverance, unlimited faith in yourself, highly specialized knowledge and time it is impossible to become a master. If you have a clear goal and you are working to achieve it, everything will work out.

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