The Alpha Masters: Unlocking the Genius of the World's Top Hedge Funds (40 page)

David McCormick, my awesome agent at McCormick & Williams—you took me and this project on within
15 seconds
on the phone and landed me my first great book deal.

A special thank you to Mohamed El-Erian, PIMCO CEO and co-CIO, for being a superior mentor to me during the tedious writing process, and for such a well-thought-out and researched foreword to this book. To all the individuals who read my entire manuscript and provided very useful feedback, perspective, and comments, like Julian Robertson, Bill Ackman, Roxanne Donovan, Roy Katzovicz, Nouriel Roubini, Myron Scholes, Jeff Kaplan, Rick Sopher, Josh Friedlander, Mary Beth Grover, Jonathan Gasthalter, Parag Shah, Alexei Nabarro, Ryan Fusaro, Jim McCaughan, Jim Spellman, Mike Spence, Mario Gabelli, Leon Cooperman, and Meredith Whitney—I understand how valuable your time is; your support is priceless.

A special thank you to CNBC president and CEO Mark Hoffman and senior vice president and editor-in-chief of Business News, Nik Deogun, for supporting me in writing this book. Thank you both for always believing I could do great things. To my
Squawk
anchors: Joe Kernen, Becky Quick, and Andrew Ross Sorkin—I cannot think of a better team of talent to work with. You three are simply the best in business news. Andrew, thank you for taking the time to read the manuscript and giving me constructive feedback and suggestions. To the rest of my
Squawk
family: you guys have been amazing. None of this would have been possible without you. Words cannot express how grateful I am to Matt Quayle, executive producer and co-creator of
Squawk Box
and “Squawk on the Street,” for taking a chance on me when I was a 22-year-old with absolutely no TV and very little journalism experience. To Rob Contino, Anne Tironi, Matt Greco, Allison Keavey, Toby Taylor, Stephanie Landsman, Lori Ann Larocco, Dave Evans, Camilla Lyngsby, Dean Meelarp, and Brian Dorr—you guys are my heroes for putting up with all of my book emergencies for what seemed like endless interviews over the past two years.

To my agent, Henry Reisch, at William Morris Endeavor, for accepting the challenge that I posed; and to Morgan Oliver Mirvis, for always taking my calls—even when I called too much.

I’d also like to thank Brian Steel, SVP of Public Relations at CNBC, for all his sound guidance; Joanne O’Brien, SVP of HR, and Erin Culhane, vice president, for finding me and helping to hire me at the network; and Meredith Stark, SVP and executive producer of
CNBC.com
, for opening my eyes to all the things and opportunities I was missing—especially on
CNBC.com
.

Nick Dunn and Margaret Popper, you both have helped me extensively with learning the ropes of reporting and what it takes to break—and then present—a great story. I’d also like to thank Mary Duffy for getting me “ready to go at a moment’s notice,” and the following folks: Elisabeth Sami, Susan Krakower, Carl Quintanilla, Max Meyers, Sonya Uribe, Jason Gewirtz, Claudine Gizenski, Debbie Perry, Jeannine Lavin, Todd Bonin, Shpresa Neziri, Gail Terry, and Mary Ann Laeteno-Fox.

To my external editorial team: my editor, Adrienne Schultz—you kept me sane for the past two years (and yes, more concise); my researcher and fact checker, Elana Margulies—you kept me well sourced; and Jamie Malanowski—your polish on prose is truly a thing of beauty.

And to the team at Wiley including Nicholas Snider, Sharon Polese, Jocelyn Cordova, Vincent Nordhaus, Tula Batanchiev, Judy Howarth, and Laura Walsh. As well as the team at CJP Communications, including Suzanne Hallberg, Brendan McManus, and Caroline Cannon.

To all of the data providers that generously compiled charts and graphs for this book, especially Hedge Fund Intelligence, LCH Investments NV, Ipreo: Bigdough, and Hedge Fund Research.

To all of my friends, sources in the industry, and individuals who have aided me through various stages of the book, including: David & Cheryl Einhorn, Whitney Tilson, James Grant, Alan Greenspan, Katie Broom, Sam Zell, Terry Holt, Barry Sternlicht, Beth Shanholtz, Ace Greenberg, Israel Englander, John Novogratz, Nelson Peltz, Anne Tarbell, Marc Andreessen, Michael Vachon, Elissa Doyle, Margit Wennmachers, Randall Kroszner, Jenny Farrelly, Tom Hill, Jonathan Gray, Peter Rose, Anne Popkin, Anthony Scaramucci, Victor Oviedo, David Waller, Sallie Krawcheck, Armel Leslie, Stefan Prelog, Chris Gillick, Alexis Israel, Lex Suvato, Kenny Dichter, Steve Starker, Saadi Ouaaz, Jonathan Wald, Jayesh Punater, James Wong, Joseph Weisenthal, Julie Vadnal, Darcy Bradbury, Trey Beck, Kyle Bass, and Jacob Wolinsky.

Finally, to all of the subjects of this book, the
Alpha Masters
.

About the Author

Maneet Ahuja
is CNBC’s Hedge Fund Specialist and a producer on
Squawk Box
. In 2011, she co-created and developed the network’s “Delivering Alpha” hedge fund summit in conjunction with
Institutional Investor
and was awarded CNBC’s prestigious Enterprise Award in 2009 for her groundbreaking coverage of the industry. Noteworthy work includes hedge fund titan David Tepper’s first-ever TV appearance, sparking a two-week “Tepper Rally” in the markets, David Einhorn’s warning call on Lehman Brothers as well as his bid to purchase the Mets, and John Paulson’s letter to investors in response to the SEC investigation into the Goldman Abacus deal. She has covered the World Economic Forum in Davos, Switzerland, and produces quarterly shows at the Department of Labor with former Federal Reserve Board president Alan Greenspan as well as Competitiveness Summits at Harvard Business School.

Prior to joining CNBC in 2008, she was a part of the
Wall Street Journal
’s Money & Investing team. She began her career on Wall Street in 2002 at age 17 in Citigroup’s Corporate & Investment Banking division as a credit risk analyst.

She is one of
Forbes
magazine’s 30 Under 30 (January 2012), has been featured in
Elle
magazine’s annual Genius issue (April 2011), and in 2010 was nominated for
Crain’s New York Business
“40 Under 40 Rising Stars.” This is her first book.

Twitter: @WallStManeet

www.thealphamasters.com

Index

Ackman, William A.
See also
Pershing Square Capital Management

Federal Agricultural Mortgage Corporation (Farmer Mac)

“Buying the Farm” (white paper)

First Union Real Estate

Gotham Partners

MBIA

Pershing Square Capital Management

Rockefeller Center deal

Adam, Michael

All Weather portfolio

Alpha

American Axle

Amroc Investments

Anadarko Petroleum Corporation

Apotheker, Leo

Appaloosa Management

investments

Delphi Corporation

Marconi Corporation

Russian bonds

Washington Mutual

Auto bailout

Avenue Capital Group

auto bailout

Morgan Stanley Investment Management, investment in

partnership

Six Flags, investment in

Axelowitz, Mark

Baldwin-United Corporation

Bank of America

Barnes & Noble

Bass, Robert

Berkowitz, Bruce

Berkowitz, David

Berkshire Hathaway

Beta

Black, Fischer

Bohart, Stuart

Bonderman, David

Borders

Bostock, Roy

Bradbury, Darcy

Bridgewater Associates

crisis indicator

D-process

extracting alpha

foreseeing the financial crisis

depression gauge

Pure Alpha strategy

Brown, Jay

Bucksbaum, Madelyn

Buffett, Warren

Canadian Pacific Railway

Chanos, James.
See also
Kynikos Associates LP

China’s coming crisis

Enron, investigation of

Tyco, investigation of

Chrysler

Citigroup

Clarke, Peter

Coalition of Private Investment Companies

Coffey, Greg

Corzine, Jon

Cox, Christopher

Cumming, Ian

D-process (Bridgewater)

Dade Behring

Dalio, Ray

All Weather portfolio

Bridgewater Associates

crisis indicator

foreseeing the financial crisis

gold, position in

Pure Alpha strategy

Daily Observations
(client letter)

Northeast Airlines investment

World Bank

Post-Modern Portfolio Theory (PMPT)

Principles

Delphi Corporation

Delucia, David

Depression gauge (Bridgewater)

Distressed debt

Dow Chemical

ED&F Man

Emergency Economic Stabilization Act of 2008

“Engineering Targeted Returns and Risks” (Dalio)

Enron

Falcone, Phil

Federal Reserve

Feldstein, Martin

Ford Motor Company

Fournier, Alan

Friedman, Stephen

Furst, Rich

Gardner, Sonia.
See also
Avenue Capital Group

Amroc Investments

Avenue International

Robert M. Bass Group (Keystone, Inc.)

Geiger, Adam

General Growth Properties (GGP)

General Motors

GLG Partners

Goldstein, Ronnie

Gottesman, Noam

Green, Jonathan

Greenberg, Ace

Greenspan, Alan

Griffin, Ken