Bill Lipschutz is a forex trader and the director and co-founder of portfolio management at Hathersage Capital Management and a former director of Global Head of Foreign Exchange at Solomon brothers. He shot to fame when he was featured in Jack Schwager’s Market Wizard – a book made from the compilation of some of the best trading minds.
Bill Lipschutz’s early life and career
Bill Lipschultz was born and raised in Farmingdale, New York, a bright student throughout his high school. Bill was also good at maths. He was a tennis enthusiast and a good tennis player as well.
During his university year, Bill spent time studying and researching the market— at that same time, he inherited $12,000 worth of stock holdings from his late grandmother. Afterward, he liquidated all his inherited stock portfolio to kick-start his trading career. As he would put it, ‘it’s tough to be different from the rest of the crowd the majority of the time, which by definition is what you’re doing if you’re a successful trader.’
Bill had beginner’s luck at the early stage of his trading career-making close to $250 000 in profits from his liquidated stock portfolio. But this success was short-lived, maybe due to his overconfidence or greed, trading without applying proper risk management techniques resulting in the loss of nearly all his trading equity. The loss, he would go on to say, “I don’t think you can consistently be a winning trader if you’re banking on being right more than 50 percent of the time. You have to figure out how to make money right only 20 to 30 percent of the time.”
Lipschultz joined the Foreign Exchange Department after receiving an invite during a Solomon Brothers’ training program. The Solomon Brothers kick-started their firm at the same time the forex market took off. Lipschultz was ranked among the top 5 forex traders in the world. During his time in the Solomon Brothers, he made a constant profit of about $300 million for the firm per year.
Lipschultz was the senior trader overlooking the Solomon Brothers’ proprietary forex account from 1984 until his resignation in 1990, and he headed both the New York Foreign Exchange Trading Desk and the Global Foreign Exchange Options Group. Bill was a member of the Ad hoc Federal Reserve Options Committee and Board of Governors of the Philadelphia Stock Exchange. He retired from the Solomon Brothers in 1990. In 1995, Lipschultz, together with his former classmates, founded Hathersage Capital Management. The firm is a Macro-manager and trades only G10 currencies. Most of Hathersage’s success is Bill, director of its portfolio management division since its establishment.
Bill was admitted into the Trader Hall Monthly Hall of Fame in 2006. He was also featured in two publications about exceptional traders: The New Market Wizards: Conversations with America’s Top Traders by Jack D. Schwager. Written in 1992 and The Mind of a Trader by Alpesh B. Patel in 1998.
He graduated from Cornell University with a Bachelor’s Degree in Fine Arts and got an MBA in finance from the Johnson School of Management at the same Cornell. Bill met his wife, Lyndelle Jones, during his student year at Cornell.
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- Brett Steenbarger – All About Trading Psychology
- Joe Ritchie – an early quant in the option markets
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- Mark Minervini – stock market wizard trader
- Mark D. Cook – market wizard trader and investor (Net worth and strategy)
- Jeffrey Yass – the founder of Susquehanna
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Bill Lipschutz trading strategy quotes
The article ends with some quotes from Bill Lipschutz:
When I talk about working hard, I mean commitment and focus.
It’s very difficult to be different from the rest of the crowd the majority of the time, which by definition is what you’re doing if you’re a successful trader.
I like the game. I think it’s a great challenge. It’s also an easy game to keep score of (why he’s trading).
When you’re in a losing streak, your ability to properly assimilate and analyze information starts to become distorted because of the impairment of the confidence factor, which is a by-product of a losing streak. You have to work very hard to restore that confidence, and cutting back trading size helps achieve that goal.