Victor Niederhoffer

Victor Niederhoffer, a well known hedge fund manager, champion squash player and statistician, studied statistics and economics at Harvard University (B.A. 1964) and the University of Chicago (Ph.D. 1969). He was a finance professor at the University of California, Berkeley (1967-1972). In 1965, while still at college he co-founded with Frank Cross a company called Niederhoffer, Cross and Zeckhauser, Inc., an investment bank which sold privately held firms to public companies. This firm is now called Niederhoffer Henkel, and is run by Lee Henkel, the former general counsel to the IRS. Victor pioneered a mass marketing approach in investment banking, and did a large volume of small deals at this firm. Niederhoffer also bought many privately held firms with Dan Grossman, his partner during this period. Image File history File links No higher resolution available. ... Image File history File links No higher resolution available. ... Harvard University (incorporated as The President and Fellows of Harvard College) is a private university in Cambridge, Massachusetts, USA and a member of the Ivy League. ... Also Nintendo emulator: 1964 (emulator). ... The University of Chicago is a private university located principally in the Hyde Park neighborhood of Chicago. ... Also: 1969 (Stargate SG-1) episode. ... Sather tower (the Campanile) looking out over the San Francisco Bay and Mount Tamalpais. ... Year 1967 (MCMLXVII) was a common year starting on Sunday (link will display full calendar) of the 1967 Gregorian calendar. ... Year 1972 (MCMLXXII) was a leap year starting on Saturday (link will display full calendar) of the Gregorian calendar. ... Year 1965 (MCMLXV) was a common year starting on Friday (link will display full calendar) of the 1965 Gregorian calendar. ... To meet Wikipedias quality standards, this article or section may require cleanup. ...

As a college professor in the 1960s and 1970s, he wrote numerous influential academic articles about market inefficiencies which led to the founding in 1980 of a trading firm, NCZ Commodities, Inc. (aka Niederhoffer Investments, Inc.). The success of this firm attracted the attention of George Soros. Niederhoffer became a partner of Soros’ and managed all of the Fixed Income and Foreign Exchange from 1982-1990. ^[1] Soros said in The Alchemy of Finance that Niederhoffer was the only one of his managers who retired voluntarily from trading for him while still ahead. In fact Soros held Victor in such high esteem, that he sent his son to work for him to learn how to trade. ^[1] Year 1980 (MCMLXXX) was a leap year starting on Tuesday (link displays the 1980 Gregorian calendar). ... George Soros (pronounced ) [Shorosh] (born August 12, 1930, in Budapest, Hungary, as György Schwartz) is an American financial speculator, stock investor, philanthropist, and political activist. ... This article does not cite any references or sources. ... Foreign exchange has several meanings: In telecommunications, Foreign exchange service is a type of network service. ...

Returns

Niederhoffer Investments returned 35% a year from inception through 1996, when MAR ranked it the No. 1 hedge fund manager in the world. In 1997 Victor published a NY Times bestselling book, The Education of a Speculator. A hedge fund is a private investment fund charging a performance fee and typically open to only a limited range of qualified investors. ...

1997 Losses

In 1997, Niederhoffer Investments was not finding many opportunities for investment, and having returned much of its funds to customers such as George Soros, began investing the remaining 100 million dollars in areas where Niederhoffer later admitted that he did not have much expertise. ^[2] Niederhoffer decided to buy Thai bank stocks, which had fallen heavily in the Asian financial crisis, his bet was that the Thai government would not allow these companies to go out of business. On October 27, 1997, losses resulting from this investment, combined with a 554 point (7.2%) single day decline in the Dow Jones Industrial Average (the largest point decline to date in index history, though not the largest percent decline) forced Niederhoffer Investments to close its doors. In a lawsuit Niederhoffer later filed in the U.S. District Court for the Northern District of Illinois against the Chicago Mercantile Exchange, where he traded options, he alleged that floor traders colluded to drive the market down that day to force him out of his positions. Traders at the time said Refco may have been responsible for as much as $35 million of Niederhoffer's losses.^[3] The Asian financial crisis was a financial crisis that started in July 1997 in Thailand and affected currencies, stock markets, and other asset prices in several Asian countries, many considered East Asian Tigers. ... Refco (NYSE: RFX), once Ray E. Friedman and Co. ...

New Fund

Since closing down his fund in 1997, he began trading for his own account again in 1998, after mortgaging his house and selling his antique silver collection. This original fund is called Wimbledon Fund, the name reflecting his love of tennis. He began managing money for offshore clients in February 2002, with the Matador Fund. Niederhoffer employs proprietary programs that predict short-term moves using multivariate time series analysis. In the five-year period since 2001, Victor Niederhoffer's fund has returned 50% a year(compounded). His worst year in this period was 2004 returning 40%, in 2005 he returned 56.2% (as reported in eFinancial News). On April 6, 2006, the industry group MarHedge awarded ^[4] Matador Fund Ltd. And Manchester Trading, two funds managed by Niederhoffer the prize for best performance by a Commodity Trading Advisor (CTA) in the two years 2004 and 2005. Year 1998 (MCMXCVIII) was a common year starting on Thursday (link will display full 1998 Gregorian calendar). ...

From 2000-2003, Niederhoffer co-wrote with financial writer Laurel Kenner a widely read weekly column on the markets for CNBC MoneyCentral.^[5] He and Kenner co-wrote Practical Speculation (John Wiley & Sons, February 2003), called "the best trading book of the young millennium" by Active Trader magazine. Niederhoffer's life story, and the lessons he learned growing up that helped him become a success were told in, the 1997 best-selling book The Education of a Speculator. Year 2000 (MM) was a leap year starting on Saturday (link will display full 2000 Gregorian calendar). ... Year 2003 (MMIII) was a common year starting on Wednesday of the Gregorian calendar. ... Laurel Kenner was born in California in 1944. ... This article is about CNBC U.S., the business news channel in the U.S.. For other uses, see CNBC (disambiguation). ... Laurel Kenner was born in California in 1944. ... Active Trader is a monthly financial magazine that features strategies, analysis and news for active traders and investors. ...

On his website^[6] Niederhoffer claims to be proudest of having had “a benevolent influence” on people that came in contact with him. At least a dozen employees whom he started out or taught became billionaires or multi-centimillionaires, including Monroe Trout, Toby Crabel, Stu Rose, John Hummer and Roy Niederhoffer (Victor's younger brother), all of whom are famous in money management or M&A. A billionaire is a person who has a net worth of at least one billion units of currency, such as United States Dollars (USD), Pounds or Euros. ... Folks who never do any more than they are paid for will never get paid for any more than they do. ... To meet Wikipedias quality standards, this article or section may require cleanup. ... Toby Crabel at trading office. ... The phrase mergers and acquisitions (M&A) refers to the aspect of business strategy and management dealing with the merging and/or acquiring of different companies. ...

Victor Niederhoffer is famous for hiring young and extremely bright traders, whom he mentors. He encourages them to develop their own trading strategies, and runs his firm more like a science lab than a traditional trading firm. In January 2007, Victor turned over most of the day to day trading at Niederhoffer Investments to his Partner Steve Wisdom, who has worked with him for 15 years. While he is still involved in the business he now devotes most of his time to his children, and reading..^[7]

Squash

Niederhoffer is one of the greatest hardball squash players in history, and is a member of the squash hall of fame. ^[8] Niederhoffer who had played racquet sports all his life growing up had never played squash when he entered Harvard University in 1960. One year later he won the national junior title and by the time he graduated, Niederhoffer was the National Intercollegiate squash champion. He won the U.S. Nationals five times (a record exceeded only by Stanley Pearson who won his sixth in 1923). He also won three national doubles titles. In 1975, he defeated one of the greatest players in the history of the game Sharif Khan in the final of the North American Open (the only time that Khan failed to win the title in the 13 year period between 1969 and 1981). Hardball squash is a format of the indoor racquet sport squash which was first developed in the North America in the late-nineteenth century and early-twentieth century. ... Sharif Khan is a retired professional squash player. ... The United States Open squash championships is an annual squash tournament. ...

Other Activities

Niederhoffer is also the founder of the NYC Junto, a libertarian group hosted on the first Thursday of every month since 1985. He is an enthusiast of Ayn Rand. The NYC Junto focuses on libertarianism, objectivism and investing and was inspired by the Junto hosted by Benjamin Franklin in Philadelphia from 1727 to 1757. He has six daughters, Galt (named after Sir Francis Galton), Katie, Rand, Victoria, Artemis and Kira. His son Aubrey (named after the main character from the Aubrey Maturin series of novels by Patrick O'Brian) was born in May 2006. The New York City Junto is a monthly meeting which focuses on libertarianism, Objectivism and investing. ... See also Libertarianism and Libertarian Party Libertarian,is a term for person who has made a conscious and principled commitment, evidenced by a statement or Pledge, to forswear violating others rights and usually living in voluntary communities: thus in law no longer subject to government supervision. ... This article is about the year. ... Ayn Rand (IPA: , February 2 [O.S. January 20] 1905 – March 6, 1982), born Alisa Zinovyevna Rosenbaum (Russian: ), was a Russian-born American novelist and philosopher,[1] best known for developing Objectivism and for writing the novels We the Living, The Fountainhead, Atlas Shrugged and the novella Anthem. ... This article does not adequately cite its references. ... This article is about the philosophy of Ayn Rand. ... Investment is a term with several closely related meanings in finance and economics. ... The Junto was a club established in 1727 by Benjamin Franklin for mutual improvement in Philadelphia. ... Benjamin Franklin (January 17 [O.S. January 6] 1706 – April 17, 1790) was one of the most well known Founding Fathers of the United States. ... For other uses, see Philadelphia (disambiguation) and Philly. ... Events 1727 to 1800 - Lt. ... 1757 was a common year starting on Saturday (see link for calendar). ... Galt Niederhoffer (born 1975) is an American movie producer and novelist. ... Francis Galton Sir Francis Galton FRS (February 16, 1822 - January 17, 1911) was an English explorer, statistician, anthropologist, creator of modern eugenics (he coined the term), and investigator of the human mind. ... Patrick OBrian (12 December 1914 – 2 January 2000; born as Richard Patrick Russ) was an English novelist and translator, best known for his Aubrey–Maturin series of novels set in the Royal Navy during the Napoleonic Wars and centered on the friendship of Captain Jack Aubrey and the Irish...

Bibliography

• The Education of a Speculator, John Wiley & Sons, 1998, ISBN 0-471-24948-3.
• Practical Speculation, John Wiley & Sons, 2005, ISBN 0-471-67774-4. Coauthor: Laurel Kenner
• Fifty Years in Wall Street, John Wiley & Sons Investment Classics, 2006 Henry Clews & Victor Niederhoffer, ISBN 0-471-77203-8.

The Wiley Building in Hoboken, New Jersey, located on the waterfront between River Street and Frank Sinatra Drive. ... Year 1998 (MCMXCVIII) was a common year starting on Thursday (link will display full 1998 Gregorian calendar). ... The Wiley Building in Hoboken, New Jersey, located on the waterfront between River Street and Frank Sinatra Drive. ... Year 2005 (MMV) was a common year starting on Saturday (link displays full calendar) of the Gregorian calendar. ... Laurel Kenner was born in California in 1944. ... The Wiley Building in Hoboken, New Jersey, located on the waterfront between River Street and Frank Sinatra Drive. ... Year 2006 (MMVI) was a common year starting on Sunday of the Gregorian calendar. ...

References

Sawyer, Nick. "The iconoclast of Brooklyn", Profile, Risk magazine, March 2004. Retrieved on 2006-09-18.  Risk Magazine is the leading international derivatives and risk management magazine. ... Year 2006 (MMVI) was a common year starting on Sunday of the Gregorian calendar. ... is the 261st day of the year (262nd in leap years) in the Gregorian calendar. ...

Sweeney, John. "Interview: Victor B. Niederhoffer - Music of the Markets", Stocks & Commodities magazine, April 2001. Retrieved on 2006-09-05.  Technical Analysis of STOCKS & COMMODITIES The Traders’ Magazineâ„¢ is a U.S. based monthly magazine about commodity futures contracts, stocks, options, derivatives and forex. ... Year 2006 (MMVI) was a common year starting on Sunday of the Gregorian calendar. ... is the 248th day of the year (249th in leap years) in the Gregorian calendar. ...

Notes

1. ^ ^{a b} Niederhoffer, Victor (1997). The Education of a Speculator. 
2. ^ Niederhoffer, Victor (2003). Practical Speculation. 
3. ^ Robison, Peter. "Bennett's Refco Scheme Exposed by Late-Night Hunch", Bloomberg, October 27, 2005. Retrieved on 2006-09-18. 
4. ^ "MARHedge Performance Awards 2006: Winners", Marhedge, April 7, 2006. Retrieved on 2006-09-18. 
5. ^ Contributors:Bios. MSN Money (2006). Retrieved on 2006-09-18.
6. ^ Niederhoffer, Victor (2006). About Us. Retrieved on 2006-09-18.
7. ^ Altucher, James. "Niederhoffer Retirement", Realmoney.com, February 08, 2007. Retrieved on 2007-09-26. 
8. ^ Victor Niederhoffer: Opened up Squash. Squashtalk (2006). Retrieved on 2006-09-18.

Bloomberg L.P. is the largest financial news and data company in the world, controlling 33% of market share. ... Year 2006 (MMVI) was a common year starting on Sunday of the Gregorian calendar. ... is the 261st day of the year (262nd in leap years) in the Gregorian calendar. ... Year 2006 (MMVI) was a common year starting on Sunday of the Gregorian calendar. ... is the 261st day of the year (262nd in leap years) in the Gregorian calendar. ... Year 2006 (MMVI) was a common year starting on Sunday of the Gregorian calendar. ... is the 261st day of the year (262nd in leap years) in the Gregorian calendar. ... Year 2006 (MMVI) was a common year starting on Sunday of the Gregorian calendar. ... is the 261st day of the year (262nd in leap years) in the Gregorian calendar. ... Year 2007 (MMVII) is the current year, a common year starting on Monday of the Gregorian calendar and the AD/CE era in the 21st Century. ... is the 269th day of the year (270th in leap years) in the Gregorian calendar. ... Year 2006 (MMVI) was a common year starting on Sunday of the Gregorian calendar. ... is the 261st day of the year (262nd in leap years) in the Gregorian calendar. ...

Personalities of Wall Street

See List of personalities associated with Wall Street. Over the years, certain persons associated with Wall Street have become famous, even legendary. ...

External links

• Daily Speculations The Web site of Victor Niederhoffer and Laurel Kenner
• Writings Writings of Victor Niederhoffer
• The Education of a Speculator Book Reviews
• Article mentioning lawsuit
• Inside a hedge-fund meltdown Article
• Victor Niederhoffer Squash Hall of Fame Profile
• NYC Junto founded by Victor
• Blowing Up A Malcolm Gladwell article about the investment strategy of Niederhoffer, and the opposite strategy used by Nassim Taleb.