(born November 20, 1968) is an American investor,hedge fund manager, and philanthropist. He is the founder and president ofGreenlight Capital, a long-short value-oriented hedge fund.
Born inNew Jersey, Einhorn graduated fromCornell Universityin 1991 and moved toWestchester, New Yorkto start his fund. He started his fund in 1996 with $900,000 and has generated 16.5% annualized return for investors from 1996 to 2016.3Greenlight Capitalsassets under managementhas decreased from approximately US$12 billion in 2014 to about $5.5 billion as reported in July 2018 as the fund is down 11.3 from 2014 through the end of 2017.4He has received extensive coverage in the financial press for his funds performance, his investing strategy and hispositions.5
Einhorn was ranked 44th in theTime 100 most influential listof people in the world in 2013.6According toForbes Magazine, Einhorn has anet worthof US$1.52 billion (as of February 2018),1making him the 44th youngest billionaire on the Forbes 400 and the 18th highest-earning hedge fund manager in the world.78
Einhorn was born to aJewishfamily in New Jersey, the son of Stephen and Nancy Einhorn,91011Raised inDemarest, New Jersey12the family moved to Wisconsin when he was seven.11His father is the founder and president of Einhorn & Associates, a consulting firm, and Capital Midwest Fund, a venture capital fund.13He has one brother Daniel who works with his father. In 1987, Einhorn graduated fromNicolet High SchoolinGlendale, Wisconsin.14Einhorn graduatedsumma cum laudefromCornell Universitywith a B.A. in Government from the College of Arts and Sciences in 1991. He was a member of theat Cornell.15
Einhorn startedGreenlight Capitalin May 1996 with $900,000 in start up capital. In May 2002, he gave a speech at theSohn Investment Research Conferencewhere he recommendedshortinga mid-cap financial company calledAllied Capitaleventually disclosing that he himself had a substantial short position. The day after the speech the companys stock went down by 20 percent.16Einhorn alleged the company of defrauding theSmall Business Administrationwhile Allied said that Einhorn was engaging inmarket manipulation, and illegally accessed his phone records usingpretexting.17In June 2007, after a lengthy investigation by theU.S. Securities and Exchange Commission(SEC), it found that Allied brokesecurities lawsrelating to the accounting and valuation of illiquid securities it held.18After the incident, Einhorn has published a book,Fooling Some of the People All of the Timeregarding this six-year fight.19Reviews of the book were generally positive;Seeking Alpha, said of the book: the case against Allied Capital is laid out to the last detail. Because of the immense amount of data in the book, I would imagine that some readers may want to skip a page here and there. However, the book is by no means dull. This book proves that truth is really stranger than fiction.2021Einhorn would come to view Allied as a microcosm ofmarket trends: What weve seen a year later is that Allied was the tip of an iceberg; that this kind of questionable ethic, philosophy and business practice was far more widespread than I recognized at the time…Our country, our economy, is paying a huge price for that.22
In January 2012, theU.K. Financial Services Authority(FSA) fined Einhorn and Greenlight Capital $11.2 million for trading on inside information. The FSA claimed Einhorn obtained information on the Punch Taverns Plc (PUB) equity fundraising by a broker representing the company prior to public knowledge of the event. Over the following four days, Einhorn sold more than 11 million shares, avoiding a 29.9% stock price collapse and subsequent loss of about 5.8 million.23Einhorn called the 7.2m fine unjust and inconsistent with the law but said he would pay it rather than continue an arduous fight24The fine was the second largest levied on an individual in the history of Britains Financial Services Authority.25
In July 2007, Einhorn shortedLehman Brothersstock, believing that Lehman had massive exposures to illiquid real estate investments that were improperly accounted for.26He also claimed that they used dubious accounting practices in their financial filings.5Einhorn shared his thesis on Lehman in November 2007 at the Value Investing Congress.27
WhenBear Stearnshad to be bailed out by the Federal Reserve in March 2008, Lehman was widely considered to be in a weak financial situation.citation neededIn a speech at a conference in April, Einhorn announced his Lehman short position.528In May, Lehmans CFO Erin Callan held a private teleconference with Einhorn and his staff, who29hoped Callan could explain discrepancies they had uncovered since the firms latest financial filing. Einhorn publicly characterized Callans responses on the call in a negative light and Lehman stock fell sharply. Callan was fired a few weeks later when Lehman reported a $2.8 billion quarterly loss. Lehman would declare bankruptcy in September 2008.
On May 26, 2011, Einhorn called forSteve Ballmer, CEO ofMicrosoft, to step down after Microsoft had been passed by bothGoogleandApple30inmarket value.31
Speaking at the Value Investing Congress in New York City on October 17, 2011, Einhorn publicly announced his short position inGreen Mountain Coffee Roastersstock.32Prior to that date, the companys share price had increased more than tenfold since March 2009, the third-biggest gain in the. In his presentation Einhorn opined that the market for Green Mountains newKeurigsingle-cup coffee brewer was limited, and that theK-Cupcoffee pods for the machine presented a looming patent issue for the company. He also said that Green Mountain had a litany of accounting questions. Following Einhorns speech Green Mountains share price fell by 10 percent, closing that day at $82.50.33
A few weeks later on November 9, 2011, Green Mountains quarterly report missed analyst expectations and its stock price plunged to $43.71. The companys CEO Lawrence J. Blanford cited a number of factors including changes in wholesale customer ordering patterns in our grocery and club channels for the underperformance of the company. The stock had a run up to 157 in Nov 2014, before its final pricing in the 90s, prior to the company being sold.
In early February 2013 Einhorn filed a lawsuit againstApple a Manhattan court in order to pressure the company to issue dividend-paying perpetual preferred stock as a means of distributing some of its$137 billionin cash to shareholders.34Later that month Einhorn set what oneWall Street Journalheadline called a Legal Precedent in Corporate Governance when the court ruled in favor of Einhorn and determined that Apples attempt to bundle a measure requiring a shareholder vote prior to issuing preferred shares with a larger shareholder proposal impermissibly bundles separate matters for shareholder consideration.3536
Speaking at the Sohn Investment Conference on May 4, 2015, Einhorn sharply criticized the practice ofhydraulic fracturingor fracking. He said, A business that burns cash and doesnt grow isnt worth anything.37Specifically, Einhorn announced short positions onPioneer Natural ResourcesandConcho Resources. David Einhorn also shows his humorous side joking that Pioneer natural resources is a Motherfracker.38
In 1993, Einhorn married Cheryl Strauss, a financial reporter and media consultant; they divorced in 2017.3940He has three children with Cheryl, two daughters, Rachel and Naomi, and a son, Mitchell (Mitch).15Einhorn lives inWestchester County, New York.
David Einhorn is a known Democratic donor.41He is reported to drive aHonda Odyssey.4243
He is also a founding Master Player of thePortfolios with Purposevirtual stock trading contest.44
As of February 2017,Forbes Magazinereported Einhorn to have an overall net worth of US$1.54 billion.1He is the 432nd richest person in the United States, and the 18th wealthiest hedge fund manager.1
Einhorn is a major contributor and board member ofThe Michael J. Fox Foundation. In 2006, Einhorn finished 18th in theWorld Series of Pokermain event and donated his winnings (over $650,000) to the foundation.45He is also on the board of theRobin Hood Foundationand a contributor to numerous charities in the New York area. In the Spring of 2009, as promised in his bookFooling Some of the People All of the Time,Greenlight Capital donated all of the general partners profits from the shorting of Allied Capital stock (an additional $6 million – Greenlight already donated $1 million in 2005 to Tomorrows Childrens Fund – to make a total of $7 million) to three organizations (Tomorrows Childrens Fund, The Project On Government Oversight (POGO) and theCenter for Public Integrity (CPI)). In 2012, Einhorn donated his winnings from theTournament (which had a one million dollar buy in, and in which he won $4,352,000 for his 3rd-place finish) toCity Year.4647
On May 26, 2011, theNew York Metsannounced that Einhorn had agreed to buy a minority share of thebaseballteam for $200 million.48Einhorn had the option to purchase a majority stake in the Mets after three years if current majority ownerFred Wilponand his family could not meet their financial obligations by then.49On September 1, 2011, the Mets announced that they had ended negotiations to sell minority ownership to Einhorn.50
Alden, William (October 25, 2012).David Einhorn Continues His Take Down of Fed Policy. DealBook
Milwaukee Journal Semtinel: Venture capitalist Einhorn paid for voter fraud billboards By Daniel BiceOctober 29, 2012
Forbes Israel: Jewish Billionaires – Profile of David EinhornApril 14, 2013 (
New York post: Mets agree to sell minority stake in team By CLEMENTE LISIMay 26, 2011
, May 27, 2011, backed up by theInternet Archiveas of March 6, 2016. Accessed September 12, 2017. Hometown: Lived in Demarest until he was 7 years old, when his family moved to Milwaukee.
Bice, Daniel,Venture capitalist Einhorn paid for voter fraud billboards, Milwaukee
, October 29, 2012. Retrieved October 30, 2012.
Sandomir, Richard; Belson, Ken (June 6, 2011).Before Mets, Einhorn Longed for Brewers.
Julia La Roche (February 8, 2013).The Fabulous Life Of David EinhornThe Billionaire Hedge Funder Going To Battle Against AppleBusiness Insider.
Brown, Abram (February 21, 2013).Apple: Einhorn Refuses To Stop, Estimates Preferred Stock Plan Could Add $150 A Share.
The Hedge Fund Witch Hunt: Eliot Spitzers latest investigation is pursuing the wrong guys,
UltraLong (March 5, 2011).Book Review: Fooling Some of the People All of the Time: A Long Short (And Now Complete) Story
Goldfarb, Zachary A. (March 23, 2010).SEC inspector general raises red flags in new report.
Opalesque (March 13, 2009).Einhorn: Allieds rise and fall shows poor oversight.
FSA fines hedge fund manager David Einhorn 7.2m for insider trading,
FSA fines hedge fund manager David Einhorn 7.2m for insider trading,
Schreiber, Sholom,David Einhorn Given Second Largest Fine in British Financial History,
Einhorn (November 29, 2007).A Few thoughts About Risk
Cyrus Sanati,Erin Callan: the Greta Garbo of Wall Street,
How to play the short game. Financial Times. July 16, 2008
Helft, Miguel; Vance, Ashlee (May 26, 2010).Apple Passes Microsoft as No. 1 in Tech. The New York Times
Rigby, Bill; Herbst, Svea; Chan, Edwin (May 25, 2011).Hedge fund star calls for Microsofts Ballmer to go. Thomson Reuters
Wolinsky, Jacob (October 17, 2011).David Einhorn is Short GMCR.
Patton, Leslie; Gammeltoft, Nikolaj (October 17, 2011).Bloomberg News: Green Mountain Drops as David Einhorn Says Market Limited
. New York. Bloomberg News. Archived fromthe originalon July 7, 2012
David Einhorn cash case against Apple Inc rests on unusual legal tactic.
Benoit, David (February 22, 2013).Einhorns Apple Victory Seen as Legal Precedent in Corporate Governance.
Strumpf, Dan; Bray, Chad; Lessin, Jessica E. (February 22, 2013).Judge Grants David Einhorns Bid to Block Apple Proxy Vote.
Chung, Juliet; Benoit, David (May 4, 2015).Wall Street Journal: Einhorn Hits Fracking Stocks.
New York Times: ENGAGEMENTS; Cheryl Strauss, David EinhornJuly 25, 1993
Smith, Emily (February 23, 2017).Hedge fund billionaire David Einhorn heading for divorce.
Einhorn Moves Markets Except When It Comes to Apple.
When David Einhorn Talks, Markets ListenUsually.
Ziegler, Maseena (December 1, 2012).When Quitting Is Not An Option – How You Can Find Purpose And Fulfillment Through Your Career.
Bob Pajich,David Einhorn Donates All $$659,730 WSOP Winnings,
Statement from Michael Brown, City Year CEO & Co-Founder, On David Einhorns Participation in One Drop Poker Tournament. Sacramento Bee. July 3, 2012
Event 55: The Big One for One Drop – No-Limit Holdem. WSOP. July 3, 2012
New York Mets select David Einhorn as preferred partner(Press release). New York Mets. May 26, 2011
Rubin, Adam (May 29, 2010).Source outlines Mets-David Einhorn deal. ESPN.com
Sandomir, Richard (September 1, 2011).Mets Deal With Einhorn Is Off. The New York Times
The End of the Financial World as We Know It,New York Times
Einhorn bets on major currency death spiralMarketwatch.com
Articles with unsourced statements from October 2011
Wikipedia articles with WorldCat-VIAF identifiers
This page was last edited on 17 January 2019, at 20:05