Stanley Druckenmiller – His Life And Trading Strategies
Last Updated on July 31, 2022
Stanley Druckenmiller is an American investor, hedge fund manager, and philanthropist. He was the former chairman and president of Duquesne Capital, which he founded in 1981. Druckenmiller is famous, arguably because he spent many years working for George Soros.
Stanley Druckenmiller was interviewed in Jack Schwager’s New Market Wizards. The quotes that end this article are mainly taken from that interview.
This article looks very briefly at the trading career of Druckenmiller, and we end the article by taking some of the most interesting quotes.
Stanley Druckenmiller’s life and trading career
He was born in Pittsburgh, Pennsylvania, to Mr. Stanley Thomas Druckenmiller who was a chemical engineer. He was raised in a typical middle-class household in Philadelphia, and his parents divorced when he was in elementary school, so he lived with his father in Gibbstown, New Jersey, and then in Richmond, Virginia.
He graduated from Collegiate School, Richmond, Virginia, and received a B.A. in English and Economics from Bowdoin College. Later he went on to complete a Ph.D. in economics which he did at the University of Michigan. Still, he dropped out in the middle of the second semester to work as an oil analyst for Pittsburgh National Bank.
He began his financial career in 1977 when he worked as a management trainee at Pittsburgh National Bank. He later became the bank’s head of equity research group after working there for a year. And in 1981, he founded his own hedge fund, Duquesne Capital Management.
In 1985, he became a consultant to Dreyfus, an investment company, dividing his time between Pittsburgh and New York. He later moved to Pittsburgh full-time in 1986 when he was elected head of the Dreyfus Fund.
As part of an agreement with Dreyfus, he continued managing Duquesne Capital Management. At the same time, he was hired by George Soros in 1988 — replacing Victor Niederhoffer at the Quantum Fund.
When the Bank of England was broken
Stanley and Soros famously “broke the Bank of England”, when they sold the British Pound in 1992 speculating the currency peg would not hold, and they made more than $1 billion in profits in an event popularly known as “black Wednesday.” They calculated that the BOE foreign currency reserve was insufficient to buy enough pounds to support the currency and that the raised interest rates wouldn’t be politically sustainable. However, Stanley split up with Soros in 2000 after a significant loss in technology stocks.
Since then, he had concentrated full-time to manage his hedge fund, Duquesne Capital Management. He was interviewed in the book, The New Market Wizards by Jack Schwager. Unfortunately, he closed his fund in 2010, telling investors: “He’d been beaten down by the stress of trying to sustain one of the best trading records in the industry while managing a large amount of money.”
Duquesne Capital Management recorded an annual return of 30% without any losing year. The fund, however, was down about 5% when he announced his retirement. But they had covered the losses and closed with a smaller profit through a successful forecast that the market would rise in anticipation that the Fed would announce further “Quantitative Easing” to help in reducing unemployment and avoid deflation. During that time, the fund had over $12 billion in assets under management.
He was a top-down investor with a similar trading style to George Soros — holding a group of stocks long, a group of stocks short, and leveraging to trade currencies and futures.
In 2009, he was named the most charitable man in the U.S. He donated about $750 million to foundations that supported medical research, education, and anti-poverty. Stanley and his wife were also principal sponsors of the NYC AIDS walk.
Other famous traders and their trading strategies
- Top motivational trading quotes
- How Jim Simons’ trading strategies Made 66% A Year (The Medallion Fund)
- Ray Dalio – life, investment strategies, and philosophy
-
Ed Seykota – Trading Strategies and Quotes (Trend Follower Wizard)
- Jesse Livermore – The World’s Most Legendary Trader?
- Richard Dennis – The Turtle Trader (trend follower)
- William Eckhardt – The mathematical trader (An early Nassim Taleb)
- Paul Tudor Jones – Maverick Trader (quotes and strategies)
- Micheal Steinhardt – To Make Money Is Should Be A Little Painful
- David Einhorn – investment strategy and philosophy
- Bill Ackman – investment strategy and philosophy
- Steve Cohen – Stock Market Wizard
- Mark Douglas – All About The Correct Mindset
- Steve Clark – hedge fund market wizard
- Larry Williams – Indicator Innovator, Trader, And Tax Rebellion
- Jim Rogers – The Adventurist Macro Trader
- Larry Hite – All About Risk
- Randy McKay – Market Wizard currency trader
- Michael Marcus – The First Market Wizard
- Charles Faulkner – trader and programmer
- Richard Driehaus – Turtle Trader
- Dana Galante – the Market Wizard short seller
- Linda Raschke – Reading The Music Of The Markets
- Nicolas Darvas – How I made $2,000,000 In The Stock Market
- David Shaw – the king of quant – trading strategies
- Van K. Tharp – The psychology of trading
- Larry Connors – Mean Reversion Trader
- Rob Hanna – Quantifiable Edges
- Ahmet Okumus – From Istanbul to Wall Street
- Steve Watson – Small cap investor
- Gil Blake – The master of consistency
- Blair Hull – All about the trading edge
- Howard Seidler – an original Turtle Trader (The Turtle Experiment)
- Steve Lescarbeau – mutual fund trader
- Tom Basso – Mr. Serenity
- Bruce Kovner – Trade Small And Manage Risk
- Michael Carr – Trader, Motivator, And Speaker
- Bill Lipschutz – FOREX trader
- Brett Steenbarger – All About Trading Psychology
- Joe Ritchie – an early quant in the option markets
- Micheal Masters – Stock Market Wizard
- Monroe Trout – one of the first Market Wizards
- Alexander Elder – Trading Author And Indicator Innovator
- Mark Ritchie – Master Option Trader (God In The Pits)
- Alphonse Fletcher Jr. – Triple Digit Returns
- Mark Minervini – stock market wizard trader
- Mark D. Cook – market wizard trader and investor (Net worth and strategy)
- Jeffrey Yass – the founder of Susquehanna
- Claudio Guazzoni – Multillingual trader
- Micheal Lauer – Stock Market Wizard?
Stanley Druckenmiller trading strategy quotes
Bulls make money, bears make money, and pigs get slaughtered.
——
Every great money manager I’ve ever met, all they want to talk about is their mistakes. There’s a great humility there.
——
I think diversification and all the stuff they’re teaching at business school today is probably the most misguided concept everywhere.
——
Put all your eggs in one basket and then watch the basket very carefully.
——
I’ve learned many things from him, but perhaps the most significant is that it’s not whether you’re right or wrong that’s important, but how much money you make when you’re right and how much you lose when you’re wrong. (About Soros)
——
Soros is also the best loss taker I’ve ever seen. He doesn’t care whether he wins or loses on a trade.
——
The ability to accept unpleasant truths and respond decisively and without hesitation is the mark of a great trader.
——
Embarrassment is a great motivator.
——
——
What I learned from George Soros… when you see it, to bet big.
——
——
I learned that you could be right on a market and still end up losing if you use excessive leverage.