Stanley Freeman Druckenmiller (born June 14, 1953) is an American investor, hedge fund manager and philanthropist. He is the former chairman and president of Duquesne Capital, which he founded in 1981. He closed the fund in August 2010 because he felt unable to deliver high returns to his clients. At the time of closing, Duquesne Capital had over $12 billion in assets.
From 1988 to 2000, he managed money for George Soros as the lead portfolio manager for Quantum Fund. He is reported to have made $260 million in 2008.
Early life and education
Druckenmiller was born in Pittsburgh, Pennsylvania, the son of Anne and Stanley Thomas Druckenmiller, a chemical engineer. He grew up in a middle-class household in the suburbs of Philadelphia. His parents divorced when he was in elementary school and he went to live with his father in Gibbstown, New Jersey (a section of Greenwich Township, Gloucester County, New Jersey) and then in Richmond, Virginia (his sisters, Helen and Salley, would stay with their mother in Philadelphia). Druckenmiller is a graduate of Collegiate School, Richmond, Virginia. In 1975, he received a BA in English and economics from Bowdoin College (where he opened a hot dog stand with Lawrence B. Lindsey, who later became economic policy adviser to President George W. Bush). He dropped out of a three-year Ph.D. program in economics at the University of Michigan in the middle of the second semester to accept a position as an oil analyst for Pittsburgh National Bank.
Druckenmiller began his financial career in 1977 as a management trainee at Pittsburgh National Bank. He became head of the bank’s equity research group after one year. In 1981, he founded his own firm, Duquesne Capital Management.
In 1985, he became a consultant to Dreyfus, splitting his time between Pittsburgh and New York, where he lived two days each week. He moved to Pittsburgh full-time in 1986, when he was named head of the Dreyfus Fund. As part of his agreement with Dreyfus, he also maintained management of Duquesne. In 1988, he was hired by George Soros to replace Victor Niederhoffer at Quantum Fund. He and Soros famously “broke the Bank of England” when they shorted British pound sterling in 1992, reputedly making more than $1 billion in profits. They calculated that the Bank of England did not have enough foreign currency reserves with which to buy enough sterling to prop up the currency and that raising interest rates would be politically unsustainable. He left Soros in 2000 after taking large losses in technology stocks. Since then, he has concentrated full-time on Duquesne Capital. He is profiled in the book The New Market Wizards by Jack D. Schwager. According to Bloomberg News, on August 18, 2010, Druckenmiller announced the closing of his hedge fund “telling investors he’d been worn down by the stress of trying to maintain one of the best trading records in the industry while managing an ‘enormous amount of capital.'” Duquesne Capital Management posts an average annual return of 30 percent without any money-losing year. His funds were down for about 5 percent when he announced his retirement in August. However, they had since erased the losses and closed with a small gain through successful bets that the market would rally in anticipation that the Federal Reserve would announce further “Quantitative Easing” to assist in reducing unemployment and avoid deflation.
According to the Wall Street Journal, on August 18, 2010 Druckenmiller “told clients that he’s returning their money and ending his firm’s 30-year run, citing the ‘high emotional toll’ of not performing up to his own expectations.” He indicated it was not easy to make big profits while handling very large sums of money.