David M. Einhorn: Investor, Hedge Fund Guru, and Poker Enthusiast
David M. Einhorn:
Early Life and Academic Foundation
David M. Einhorn was born on November 20, 1968, into a Jewish family in New
Jersey, the son of Stephen and Nancy Einhorn. He spent his early years in
Demarest, New Jersey, before relocating with his family to Wisconsin at age
seven. His father, Stephen Einhorn, founded Einhorn & Associates, a
consulting firm, and Capital Midwest Fund, a venture capital firm. David has a
brother, Daniel, who also works in the family business. Einhorn attended
Nicolet High School in Glendale, Wisconsin, graduating in 1987, and went on to
earn his B.A. in government, summa cum laude, from Cornell University in 1991,
where he was a member of Sigma Alpha Epsilon fraternity.
Founding Greenlight Capital and Early Success
In May 1996, Einhorn launched Greenlight Capital with $900,000 in
startup capital. The hedge fund quickly gained attention for its value-oriented
investing strategy, delivering returns that consistently outperformed market
averages. Einhorn established a reputation as a bold, analytical investor capable
of challenging Wall Street conventions.
High-Profile Battles and Investment Controversies
Einhorn rose to prominence during the Allied Capital short-selling case
in 2002. Speaking at the Sohn Investment Research Conference, he disclosed a
large short position, causing the stock to drop sharply. The ensuing legal and
public battle highlighted questionable accounting practices at Allied Capital,
later validated by a six-year SEC investigation. His 2008 warning about Lehman
Brothers also cemented his reputation, as the firm collapsed during the
financial crisis following his early warnings about its exposure to risky real
estate and opaque accounting.
David M. Einhorn: Investor, Hedge Fund Guru, and Poker Enthusiast# investor, hedge fund manager, and amateur poker player#age#net worth#investor
Market Strategies and Regulatory Scrutiny
In October 2011, Einhorn publicly shorted Green Mountain Coffee Roasters
(GMCR), predicting a decline due to market saturation, patent issues, and
accounting concerns, resulting in a 50% drop in stock value by November. In
2012, the UK Financial Services Authority (FSA) fined him £7.2 million for
insider trading related to Punch Taverns PLC, as he sold shares based on
non-public information received from a broker. Despite these controversies,
Einhorn remained a respected figure in value investing circles.
Challenges and Shifts in Market Performance
In recent years, Greenlight Capital has faced declining returns. Assets
under management dropped from $12 billion in 2014 to $5.5 billion by 2018, with
losses continuing in 2017 and 2018. Critics argue Einhorn’s reliance on
traditional value investing and focus on undervalued large-cap stocks may limit
growth in today’s evolving markets. He currently holds positions in General
Motors (GM) while shorting companies like Netflix (NFLX) and Amazon
(AMZN), reflecting his adherence to his proven, though increasingly
scrutinized, strategies. Despite setbacks, Einhorn remains committed to his
long-term investment philosophy, drawing both criticism and admiration.
Personal Life, Politics, and Unique Traits
Einhorn married Cheryl Strauss, a financial reporter and consultant, in
1993; the couple raised three children before divorcing in 2017. He resides in
Westchester County, New York. Politically, he aligns with the Democratic Party
but has supported bipartisan initiatives, such as the 2012 fundraiser for the
Keeping America Competitive PAC. Known for his unpretentious lifestyle, he
drives a Honda Odyssey and actively participates in virtual stock trading
competitions through Portfolios with Purpose.
Philanthropy and Poker Pursuits
Einhorn has donated extensively to charitable causes, including the Michael
J. Fox Foundation, Robin Hood Foundation, City Year, and
other organizations. He has also leveraged his hedge fund gains for
philanthropy, donating profits from the Allied Capital short to
nonprofits like POGO and the Center for Public Integrity. A passionate poker
player, he finished 18th in the 2006 World Series of Poker (WSOP) Main Event
and 9th in the $50,000 No Limit Hold’em High Roller in 2019. As of 2023, his
lifetime tournament winnings rank him 21st in New York and 156th nationally.
Wealth and Recognition
As of mid-2019, Einhorn’s net worth was estimated at $1.5 billion by
Investopedia, reflecting his decades-long influence in hedge fund investing,
strategic market insight, and philanthropic engagement.
Legacy
David M. Einhorn stands out as a maverick investor unafraid to challenge market
orthodoxy. Through Greenlight Capital, high-profile investment campaigns, and
strategic philanthropy, Einhorn has left an indelible mark on value investing,
combining intellectual rigor with social consciousness and a flair for
strategic risk-taking.
