One of the world’s most famous investors, Stanley Druckenmiller, was born in Pittsburgh on June 14, 1953. He moved with his father to New Jersey at a young age, and then later to Richmond, Virginia. He attended college in Maine and earned a degree in English and Economics in 1975. Here he opened a hot dog stand with Lawrence Lindsey, who later became an advisor to George W. Bush.
Stanley moved on to graduate studies next. He found that the program was “overly quantitative and theoretical, with little emphasis on real-life applications.” This caused him to promptly drop out and take on a job with Pittsburgh National Bank in 1977. He worked for the bank for a short time before they promoted him to an oil analyst. Stanley Druckenmiller would quickly climb again to become the leader of the bank’s research team for equities.
Now Druckenmiller had the confidence to start a firm of his own in 1981, named Duquesne Capital Management. It has been wildly successful over the years and has helped him garner other opportunities.
Druckenmiller also worked with the investment firm Dreyfus Fund while still managing Duquesne. He began there in 1985 and was the head of the fund by 1986.
Stanley Druckenmiller and Quantum Fund
Continuing this meteoric trend, Stanley joined the eminent George Soros in 1988. He would work at Quantum Fund and continue managing Duquesne. It wasn’t long before Soros and Druckenmiller would make trading history. As mentioned in our article on George Soros, Quantum Fund had famously “broken the Bank of England.”
It began with the insight of Stanley Druckenmiller. He knew England was bound by the Exchange Rate Mechanism (ERM) with most of Europe. They would also be unwilling to raise interest rates. Britain temporarily moved from 10% to 12% interest rates, though this was a ploy to stop its currency from being damaged.
These insights were supported by Soros, who then decided it was time to bet big. England bought up hundreds of millions of Pounds Sterling. They still could not keep up with Quantum and other speculators. Short selling $10 billion earned Quantum Fund around $1 billion in one day. It forced England to withdraw from the ERM and allow its currency to devalue.
Since then, Druckenmiller has made big changes. He gave up investing client money in 2010, opting to run Duquesne with only its own capital. This concluded a 30 year run for Stanley Druckenmiller, where he had 30% returns on average and no losing years.
Recently he has been one of the world’s largest philanthropists. He has donated hundreds of millions to various causes. These include health, education, and fighting poverty.