Home Traders and trading books Jeffrey Yass – The Founder of Susquehanna

Jeffrey Yass – The Founder of Susquehanna

By
Oddmund Groette
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Jeffrey Yass is an American options trader that co-founded the Philadelphia-based Susquehanna International Group (SIG). He has a staggering net worth of 12 billion dollars, as of 2022.

Jeffrey Yass’ trading career and life:

Jeffrey Yass was born in 1956 in the Bronx and raised in Bayside, Queens. Being the son of an accountant, Jeff was exposed to arbitrage trading at an early age. He spent his early years at his father’s publicly traded financial information company — Datatab — studying stocks and esoteric securities warranties.

Jeff attended the public schools in Queens for his early education. Eventually, he earned a BA in mathematics and economics from Binghamton University in a bid to sharpen his prowess at trading and gambling. He went on to pursue graduate studies in economics at New York University but did not graduate.

While at the State University at Binghamton, Jeff realized how passionate he was about the financial markets, so he began to study the options contracts that would eventually make him rich. During his senior thesis, he examined whether options, which had started trading at the Chicago Board of Options Exchange in 1973, added value to society.

Jeff Yass went on to become a professional gambler alongside his university roommate — Dantchik. He later met Israel Englander, a multi-millionaire that regularly staked hungry young traders with his capital and later founded hedge fund Millennium Management. In 1981, Israel Englander offered Yass an empty seat on the Philadelphia Stock Exchange for $30,000 and a 50/50 revenue share.

In 1987, Yass, alongside some partners, founded the Susquehanna, a company that has grown to become a giant in options trading and financial markets, with 2,000 employees worldwide. The company recruits and trains traders using poker tournaments to sharpen decision-making skills. The company has produced several award-winning traders since its inception.

Yass has used Susquehanna’s trading profits to invest in early-stage growth companies worldwide, like TikTok parent company ByteDance, the world’s most valuable private company. As a result, his firm is now among the 20 most prominent investors in venture capital-backed companies globally. According to some estimates, owning tens of billions worth of investments spread across China, Israel, and the United States and large stakes in tech companies like Agora Inc. in China, and Credit Karma and Payoneer in the United States.

Susquehanna is becoming a powerhouse in making markets for sports bets through its Dublin-based trading unit called Nellie Analytics. The operation also stakes bets on elections and won big on Joe Biden’s 2020 Presidential election.

Interestingly, Susquehanna has also become a force in the trading of cryptocurrencies. Yass bootstrapped Susquehanna in part with startup capital plucked from racetrack pots and poker tables in the 1970s and early 1980s. He then applied his gambling instincts to options markets during the 1980s bull market, and his skill for handicapping odds and finding an edge set him apart. Yass’s number one trading rule is also the mantra of every poker pro: there is no surer way to win than to bet against someone who is dumber or less experienced than you, otherwise known as the “mark” at any poker table.

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