The Hunch, The Pounce and The Kill

[Parsad]

Article on Boaz Weinstein, from Saba Capital, who benefitted from the trading mess at JPM.  Cheers!

 

http://www.nytimes.com/2012/05/27/business/how-boaz-weinstein-and-hedge-funds-outsmarted-jpmorgan.html?partner=yahoofinance

[enoch01]

Mr. Weinstein was a pioneer in complex credit derivatives, latching onto them early in his tenure at Deutsche Bank, before they became the financial weapons of mass destruction that worsened the financial crisis. He was a profit machine at the bank, notching earnings in 10 of his 11 years trading there. At 27, he became one of the youngest managing directors in the bank’s history. Before his book blew up, Mr. Weinstein was reportedly pulling down about $40 million a year. He exploited price discrepancies and piled leverage into his trades.

 

Then his team at Deutsche Bank lost $1.8 billion during the 2008 financial crisis. The trading losses ruined bonuses throughout the bank, and ruffled more than a few feathers.

 

Hilarious.

 

So today he's again the hot hand at the table, and will no doubt take in more money as a result.  And he's sharp as a tack, I'm sure.  But what's the over/under on the amount of time it takes for him to blow up again?  Would you trust him with your money?

[ExpectedValue]

Mr. Weinstein was a pioneer in complex credit derivatives, latching onto them early in his tenure at Deutsche Bank, before they became the financial weapons of mass destruction that worsened the financial crisis. He was a profit machine at the bank, notching earnings in 10 of his 11 years trading there. At 27, he became one of the youngest managing directors in the bank’s history. Before his book blew up, Mr. Weinstein was reportedly pulling down about $40 million a year. He exploited price discrepancies and piled leverage into his trades.

 

Then his team at Deutsche Bank lost $1.8 billion during the 2008 financial crisis. The trading losses ruined bonuses throughout the bank, and ruffled more than a few feathers.

 

Hilarious.

 

So today he's again the hot hand at the table, and will no doubt take in more money as a result.  And he's sharp as a tack, I'm sure.  But what's the over/under on the amount of time it takes for him to blow up again?  Would you trust him with your money?

 

You know, Boaz Weinstein didnt really blow up. He lost lesss than 2 billion which was only an 18% drawdown in 2008 - that really is not bad.

[enoch01]

Mr. Weinstein was a pioneer in complex credit derivatives, latching onto them early in his tenure at Deutsche Bank, before they became the financial weapons of mass destruction that worsened the financial crisis. He was a profit machine at the bank, notching earnings in 10 of his 11 years trading there. At 27, he became one of the youngest managing directors in the bank’s history. Before his book blew up, Mr. Weinstein was reportedly pulling down about $40 million a year. He exploited price discrepancies and piled leverage into his trades.

 

Then his team at Deutsche Bank lost $1.8 billion during the 2008 financial crisis. The trading losses ruined bonuses throughout the bank, and ruffled more than a few feathers.

 

Hilarious.

 

So today he's again the hot hand at the table, and will no doubt take in more money as a result.  And he's sharp as a tack, I'm sure.  But what's the over/under on the amount of time it takes for him to blow up again?  Would you trust him with your money?

 

You know, Boaz Weinstein didnt really blow up. He lost lesss than 2 billion which was only an 18% drawdown in 2008 - that really is not bad.

 

No, that isn't too bad.  But I was quoting the story, which I guess was the problem.