10 Of The World's Best Investors and Traders

Familiarise yourself with the world’s top traders and learn from the best…

1) Warren Buffet

Widely considered the most successful investor of the 20th century, Buffet needs no introduction. As the Chairman and CEO of multinational conglomerate holding company Berkshire Hathaway, Buffet began investing in 1954 with just $100. According to the most recent Forbes Billionaires List, he is now worth $50 billion. In the early part of his career at Berkshire, he focused on long-term investments in publicly quoted stocks, but then turned to buying whole companies. Berkshire now owns a diverse range of businesses - everything from confectionary and home furnishings through to electric and gas utilities. Buffet’s investing advice is to think like a prospective owner, and to stick to businesses that one understands. A great business in Buffet’s book is one that possesses simplicity, predictability, high returns and strong cash generation.

2) George Soros (picture)

Soros is a Hungarian-American business magnate, Chairman of Soros Fund Management; better known as “The man who broke the Bank of England” because of his $1 billion in investment profits he made by short selling sterling during the UK’s “Black Wednesday Currency Crisis” in 1992. Specialising in bonds and currencies, short-term speculation is Soros’ preferred investment style. Like Buffet he is a great philanthropist and has given away over $8 billion to human rights, health care and education causes.

3) Jim Simons

Termed the “best trader on the planet” by educational website Turtle Trader, Simons owns a private investment company called Renaissance Technologies, which manages over $4 billion. He himself is worth over $10 billion. Simons is renowned for his belief in the potential of technical trading models, claiming that the benefit that scientists bring into the game is their ability to think technically, rather than their mathematical/computational skills. He says that they are conditioned to dismiss an apparent winning strategy until it has been properly proved that it is more than a mere statistical fluke; which leads to greater success.

4) Paul Tudor Jones

This billionaire hedge fund titan, of Tudor Investment Corp, was inspired by his trader uncle, who advised him after college to go and see Eli Tullis, a famous cotton trader. Tullis offered him a job on the floor of the New York Cotton Exchange and so began Tudor’s successful career. With a current net worth of around $3.3 billion, Tudor mainly focuses on short-term trading in equity, venture capital, debt, currency and commodity markets. Earlier this quarter, the fund bought 1.27 million shares of JPMorgan, making the New York-based bank its second-largest equity position. On 14 May, JPMorgan’s shares fell 12%, after disclosing a $2 billion trading loss involving synthetic credit derivatives. Time for Tudor to add another high-end ride to his exiting fleet of sixteen automobiles…

5) John Paulson

Paulson & Co. started in 1994 and has a portfolio value of over $13 billion. The company gained fame when Paulson, previously an unknown investor pursuing a mediocre merger arbitrage strategy, made some lucrative bets against subprime mortgages. In 2010, he made $5 billion by betting on gold. Paulson’s strength is said to lie in macro-themed investments. He doesn’t choose a single or just a few stocks from a sector, but rather a selection of stocks from each sector in which he invests.

6) Steven Cohen

Forbes magazine estimated Cohen’s fortune at $8.3 billion in September 2011, making him the 35th richest man in the world. Growing up in New York, Cohen took a liking to poker in high school, and credits the game with “teaching him how to take risks”. Starting out as a junior trader on Wall Street, he made an $8000 profit on his first day. In 1992 he started his company SAC Capital, a diversified hedge fund that uses both fundamental and quantitative analysis-based approaches. While he initially made his name as a rapid-fire trader who never held trading positions for extended periods of time, he now holds a growing number of equities for longer periods.

7) Carl Icahn

This legendary corporate raider has recently declared that he will be returning $1.76 billion back to his investors, but will continue trading with his own money. With an estimated net worth of around $14 billion, Icahn is said to be a great insider to mimic, as his moves are usually bigger than his counterparts and he therefore has to report them promptly on 13D forms, due to the fact that he usually takes activist positions. Amongst many other pursuits, in 1985 Icahn established Foxfield Thoroughbreds, a horse breeding operation, and was rumoured to pay $7 million for a young mare, Miss Oceana, who was in foal that year to champion sire Northern Dancer.

8)    David Einhorn

At 44, Einhorn is one of the younger owners of one of the world’s top hedge funds, and said to be one of the most successful long/short equity hedge fund managers of the past decade. His company Greenlight Capital has returned 21.5% since its inception in 1996, including 15.9% in tumultuous 2010. Einhorn has featured widely in the financial media for short selling Allied Capital, Lehman Brothers and Green Mountain Coffee Roasters stock. He has also made his criticism known of current investment-banking practices, saying that they are biased in order to maximise staff payouts.

9)    David Tepper

The founder of Appaloosa Management, Tepper’s investment specialty lies in distressed companies. In 2009, his hedge fund earned $7 billion by buying distressed financial stocks (including Bank of America common stock at $3 a share) and profiting from their recovery. $4 billion of these profits went to Tepper’s personal wealth, and in that year the New York Times reported him as the top-earner hedge-fund manager in the world. His $55 million donation to Carnegie Mellon University’s business school resulted in the school’s name changing to the David A Tepper School of Business.

10) Mark le Roux

Though by no means in the income league of the above-mentioned traders, le Roux’s inclusion adds some local flavor. He is currently head of the fixed interest team at Coronation, arguably South Africa’s most successful hedge fund. Prior to being at Coronation, Le Roux was integral in the development, and responsible for the management of South Africa’s first fixed-interest hedge fund, the Granite Fixed Income Hedge Fund.

Is there anyone you would add to this list, particularly South African top traders? Let us know by commenting below.