TheRumpledOne
6,411 posts
msg #49392
- Ignore TheRumpledOne |
1/19/2007 3:22:27 PM
From my inbox...
George Soros: Investment Breakdown
Born: 1930, Budapest, Hungary
Background: Launched Quantum Fund, 1969 (became the Quantum Endowment Fund in 2000)
Performance: $1,000 invested with Soros in 1969 would be worth $6 million today*
Annual Compound Rate of Return: 28.6% (through 2005)
Number of Losing Years: Four (1981, 1996, 2000, 2002) compared to nine down years for the S&P 500 since 1969 until end of 2005
*$1,000 investment in the Standard & Poor's Index in 1969 would be worth $34,314 during the same time period
When Soros shorted the British pound sterling with $10 billion worth of leverage (as he did in 1992), he would become famously known as "The Man Who Broke the Bank of England" - and he sent the world a message on just exactly how world-class risk managers operate.
Soros, who is fond of saying that risk comes from "not knowing what you are doing," knew going in that the most he could lose was about 4% of his portfolio. "There was really very little risk involved," he said after walking away with $2 billion in profits.
Soros is more interested in an idea that should serve as vital investment advice to the rest of us: It's not the amount of risk you take. More importantly, it is how much money you make when you're right about a stock and how much you lose when you're wrong.
The key to Soros' investment legend is embedded in that simple philosophy of investing in a handful of positions that generate big profits that can offset losses on other investments.
But that's not diversification, one of the top commandments followed by Wall Street types. Soros doesn't believe in diversification. He believes in getting a few big picks right and sticking with them
George Soros: Tenets of a Great Investor
George Soros owes his wealth to superb risk management and knowing when to be cautious and knowing when to be aggressive. His top 10 investment tenets, as follows, come from the book Becoming Rich: the Wealth-Building Secrets of the World's Master Investors: Buffett, Icahn, Soros.
The first priority is preservation of capital.
Be risk averse.
Develop a personal investment philosophy, an expression personality.
No two highly successful investors have the same approach.
Develop a personal system for selecting, buying, and selling investments.
Diversification is for the birds.
Do everything possible to legally minimize taxes.
Only invest in what is understandable.
Do not make investments that do not meet personal criteria. Learn to effortlessly say no.
Always search for new investment opportunities that meet personal criteria, and engage in research.
George Soros' 10 largest holdings*
Name % of total assets
Adams Respiratory Therapeutics (ARXT) 19.29
JetBlue Airways Corp (JBLU) 8.98
Bluefly Inc (BFLY) 6.34
Auxilium Pharmaceuticals Inc (AUXL) 3.89
Apex Silver Mines Ltd (SIL) 3.36
Adolor Corp (ADLR) 2.15
Pioneer Natural Resources Co. (PXD) 1.96
Companhia Vale Do Rio Doce (RIO) 1.93
Homex Development Corp (HXM) 1.69
NPS Pharmaceuticals Inc (NPSP) 1.61
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