Bruce Kovner
Encyclopedia
Bruce Stanley Kovner is an American
businessman. He is the founder and Chairman of Caxton Associates, a hedge fund
that trades a global macro
strategy and is considered amongst the worlds top and largest 10 hedge funds with an estimated $14 billion under management . In March 2011, Kovner had an estimated net worth of around $4.5 billion.
Described as secretive even by family and friends, the divorcee is perhaps one of the least known New York City
billionaire
s outside of professional circles. His Caxton Associates, despite the large amount of assets under management
, is known to be amongst the top 25 most enigmatic and secretive hedge funds globally. He is a leading philanthropist and former chairman of American Enterprise Institute
.
beliefs. Two of Kovner's fathers' cousins faced the House Un-American Activities Committee
in the 1950s, pleading the Fifth Amendment
. However, Bruce's father, Moishe Kovner, was more conservative than his kin, at one point even crossing a picket line to work.
Bruce Kovner grew up in the San Fernando Valley
, where his father had moved the family in 1953. Early on, he was a high achiever, becoming a Merit Scholar. He was the student-body president of Van Nuys High School
at 16, and an accomplished basketball
player.
Kovner went to Harvard College
starting in 1962, a time marred by the hanging
suicide
of his mother back in his family's Van Nuys home. Nonetheless, he was considered a good student and was well liked by his classmates. Avoiding the Vietnam draft
by student deferment
(when it was still available), Kovner stayed at Harvard, studying political economy
at the John F. Kennedy School of Government
, notably under prominent conservative scholar Edward C. Banfield
, who reportedly had great faith and admiration for the young Kovner.
Kovner did not finish his Ph.D.
, having suffered a severe case of writer's block
and overreached in his choice of subject matter. Over the next few years, he engaged in a number of eclectic efforts; he worked on political campaigns, studied the harpsichord
, was a writer, and a cab driver. It was during the latter occupation, not long after his marriage to now ex-wife Sarah Peter, that he discovered commodities trading
.
, in soybean
futures contract
s. Realizing growth to $40,000, he then watched the contract drop to $23,000 before selling. He later claimed that this first, nerve-racking trade taught him the importance of risk management
.
In his eventual role as a trader under Michael Marcus at Commodities Corporation
(now part of Goldman Sachs
), he purportedly made millions and gained widespread respect as an objective and sober trader
. This ultimately led to the establishment of his current company, Caxton Associates
, in 1983, which at its peak managed over $10 billion in capital and has been closed to new investors since 1992.
Kovner is not well known outside of professional circles. He has very rarely given interviews, and is notoriously private. His Fifth Avenue apartment in New York City features a lead-lined room to protect against a chemical, biological, or dirty bomb attack.
(he is on the board of the Metropolitan Opera at Lincoln Center), Kovner is an avid collector of rare books and classical music manuscripts and has given millions to art projects and art institutions, notably the Juilliard School
(of which he is Chairman). He is a primary funder of the expansion of Lincoln Center and the publisher of many works, including what some consider the finest modern illustrated bible
. He is also founder and Chairman of the School Choice Scholarships Foundation, which awards scholarships to financially disadvantaged youth in New York City.
Kovner has contributed extensively to conservative
causes. He is the former chairman of the board of trustees of the American Enterprise Institute
. His close acquaintances include former Vice President
Dick Cheney
, neoconservative figures Richard Perle
and James Q. Wilson
, as well as a wide range of government officials from all over the world - relationships which many consider contribute to Kovner's insight into commodities markets worldwide. He is a major backer of the conservative Manhattan Institute
, and The New York Sun daily newspaper.
United States
The United States of America is a federal constitutional republic comprising fifty states and a federal district...
businessman. He is the founder and Chairman of Caxton Associates, a hedge fund
Hedge fund
A hedge fund is a private pool of capital actively managed by an investment adviser. Hedge funds are only open for investment to a limited number of accredited or qualified investors who meet criteria set by regulators. These investors can be institutions, such as pension funds, university...
that trades a global macro
Global macro
Global Macro is defined as the strategy of investing, on a large scale, around the world using economic theory to justify the decision making process...
strategy and is considered amongst the worlds top and largest 10 hedge funds with an estimated $14 billion under management . In March 2011, Kovner had an estimated net worth of around $4.5 billion.
Described as secretive even by family and friends, the divorcee is perhaps one of the least known New York City
New York City
New York is the most populous city in the United States and the center of the New York Metropolitan Area, one of the most populous metropolitan areas in the world. New York exerts a significant impact upon global commerce, finance, media, art, fashion, research, technology, education, and...
billionaire
Billionaire
A billionaire, in countries that use the short scale number naming system, is a person who has a net worth of at least one billion units of a given currency, usually the United States dollar, Euro, or Pound sterling. Forbes magazine updates a complete list of U.S. dollar billionaires around the...
s outside of professional circles. His Caxton Associates, despite the large amount of assets under management
Assets under management
Assets under management is a financial term used denote the market value of funds being managed by a financial instutition on behalf of its clients, investors, depositors, etc. This metric is a sign of size and success against competition...
, is known to be amongst the top 25 most enigmatic and secretive hedge funds globally. He is a leading philanthropist and former chairman of American Enterprise Institute
American Enterprise Institute
The American Enterprise Institute for Public Policy Research is a conservative think tank founded in 1943. Its stated mission is "to defend the principles and improve the institutions of American freedom and democratic capitalism—limited government, private enterprise, individual liberty and...
.
Biography
Bruce Kovner's Jewish family came to Brooklyn, New York, in the early 1900s from Tsarist Russia, fleeing persecution for their CommunistCommunism
Communism is a social, political and economic ideology that aims at the establishment of a classless, moneyless, revolutionary and stateless socialist society structured upon common ownership of the means of production...
beliefs. Two of Kovner's fathers' cousins faced the House Un-American Activities Committee
House Un-American Activities Committee
The House Committee on Un-American Activities or House Un-American Activities Committee was an investigative committee of the United States House of Representatives. In 1969, the House changed the committee's name to "House Committee on Internal Security"...
in the 1950s, pleading the Fifth Amendment
Fifth Amendment to the United States Constitution
The Fifth Amendment to the United States Constitution, which is part of the Bill of Rights, protects against abuse of government authority in a legal procedure. Its guarantees stem from English common law which traces back to the Magna Carta in 1215...
. However, Bruce's father, Moishe Kovner, was more conservative than his kin, at one point even crossing a picket line to work.
Bruce Kovner grew up in the San Fernando Valley
San Fernando Valley
The San Fernando Valley is an urbanized valley located in the Los Angeles metropolitan area of southern California, United States, defined by the dramatic mountains of the Transverse Ranges circling it...
, where his father had moved the family in 1953. Early on, he was a high achiever, becoming a Merit Scholar. He was the student-body president of Van Nuys High School
Van Nuys High School
Van Nuys High School established in 1914, is a high school in the Van Nuys area of Los Angeles, California, belonging to the Los Angeles Unified School District: District 2...
at 16, and an accomplished basketball
Basketball
Basketball is a team sport in which two teams of five players try to score points by throwing or "shooting" a ball through the top of a basketball hoop while following a set of rules...
player.
Kovner went to Harvard College
Harvard College
Harvard College, in Cambridge, Massachusetts, is one of two schools within Harvard University granting undergraduate degrees...
starting in 1962, a time marred by the hanging
Hanging
Hanging is the lethal suspension of a person by a ligature. The Oxford English Dictionary states that hanging in this sense is "specifically to put to death by suspension by the neck", though it formerly also referred to crucifixion and death by impalement in which the body would remain...
suicide
Suicide
Suicide is the act of intentionally causing one's own death. Suicide is often committed out of despair or attributed to some underlying mental disorder, such as depression, bipolar disorder, schizophrenia, alcoholism, or drug abuse...
of his mother back in his family's Van Nuys home. Nonetheless, he was considered a good student and was well liked by his classmates. Avoiding the Vietnam draft
Vietnam War
The Vietnam War was a Cold War-era military conflict that occurred in Vietnam, Laos, and Cambodia from 1 November 1955 to the fall of Saigon on 30 April 1975. This war followed the First Indochina War and was fought between North Vietnam, supported by its communist allies, and the government of...
by student deferment
Selective Service System
The Selective Service System is a means by which the United States government maintains information on those potentially subject to military conscription. Most male U.S. citizens and male immigrant non-citizens between the ages of 18 and 25 are required by law to have registered within 30 days of...
(when it was still available), Kovner stayed at Harvard, studying political economy
Political economy
Political economy originally was the term for studying production, buying, and selling, and their relations with law, custom, and government, as well as with the distribution of national income and wealth, including through the budget process. Political economy originated in moral philosophy...
at the John F. Kennedy School of Government
John F. Kennedy School of Government
The John F. Kennedy School of Government at Harvard University is a public policy and public administration school, and one of Harvard's graduate and professional schools...
, notably under prominent conservative scholar Edward C. Banfield
Edward C. Banfield
Edward Christie Banfield was an American political scientist, best known as the author of The Moral Basis of a Backward Society , and The Unheavenly City . One of the leading scholars of his generation, Banfield was an adviser to Republican presidents...
, who reportedly had great faith and admiration for the young Kovner.
Kovner did not finish his Ph.D.
Ph.D.
A Ph.D. is a Doctor of Philosophy, an academic degree.Ph.D. may also refer to:* Ph.D. , a 1980s British group*Piled Higher and Deeper, a web comic strip*PhD: Phantasy Degree, a Korean comic series* PhD Docbook renderer, an XML renderer...
, having suffered a severe case of writer's block
Writer's block
Writer's block is a condition, primarily associated with writing as a profession, in which an author loses the ability to produce new work. The condition varies widely in intensity. It can be trivial, a temporary difficulty in dealing with the task at hand. At the other extreme, some "blocked"...
and overreached in his choice of subject matter. Over the next few years, he engaged in a number of eclectic efforts; he worked on political campaigns, studied the harpsichord
Harpsichord
A harpsichord is a musical instrument played by means of a keyboard. It produces sound by plucking a string when a key is pressed.In the narrow sense, "harpsichord" designates only the large wing-shaped instruments in which the strings are perpendicular to the keyboard...
, was a writer, and a cab driver. It was during the latter occupation, not long after his marriage to now ex-wife Sarah Peter, that he discovered commodities trading
Commodity markets
Commodity markets are markets where raw or primary products are exchanged. These raw commodities are traded on regulated commodities exchanges, in which they are bought and sold in standardized contracts....
.
Business
Kovner's first trade was in 1977 for $3,000, borrowed against his MasterCardMasterCard
Mastercard Incorporated or MasterCard Worldwide is an American multinational financial services corporation with its headquarters in the MasterCard International Global Headquarters, Purchase, Harrison, New York, United States...
, in soybean
Soybean
The soybean or soya bean is a species of legume native to East Asia, widely grown for its edible bean which has numerous uses...
futures contract
Futures contract
In finance, a futures contract is a standardized contract between two parties to exchange a specified asset of standardized quantity and quality for a price agreed today with delivery occurring at a specified future date, the delivery date. The contracts are traded on a futures exchange...
s. Realizing growth to $40,000, he then watched the contract drop to $23,000 before selling. He later claimed that this first, nerve-racking trade taught him the importance of risk management
Risk management
Risk management is the identification, assessment, and prioritization of risks followed by coordinated and economical application of resources to minimize, monitor, and control the probability and/or impact of unfortunate events or to maximize the realization of opportunities...
.
In his eventual role as a trader under Michael Marcus at Commodities Corporation
Commodities Corporation
Commodities Corporation was a financial services company, based in Princeton, New Jersey that traded actively across various commodities. The firm was noted as one of the leading commodity and futures trading firms...
(now part of Goldman Sachs
Goldman Sachs
The Goldman Sachs Group, Inc. is an American multinational bulge bracket investment banking and securities firm that engages in global investment banking, securities, investment management, and other financial services primarily with institutional clients...
), he purportedly made millions and gained widespread respect as an objective and sober trader
Trader (finance)
A trader is someone in finance who buys and sells financial instruments such as stocks, bonds, commodities and derivatives. A broker who simply fills buy or sell orders is not a trader, as they are merely executing instructions given to them. According to the Wall Street Journal in 2004, a managing...
. This ultimately led to the establishment of his current company, Caxton Associates
Caxton Associates, LLC
Caxton Associates is a global macro hedge fund founded by Bruce Kovner in 1983 headquarted in New York city. As a global macro hedge fund Caxton Associates identifies investments according to their research of global markets and analysis worldwide economic trends.-History:Kovner trained under...
, in 1983, which at its peak managed over $10 billion in capital and has been closed to new investors since 1992.
Kovner is not well known outside of professional circles. He has very rarely given interviews, and is notoriously private. His Fifth Avenue apartment in New York City features a lead-lined room to protect against a chemical, biological, or dirty bomb attack.
Philanthropy and politics
A patron of the arts and a particular devotee of operaOpera
Opera is an art form in which singers and musicians perform a dramatic work combining text and musical score, usually in a theatrical setting. Opera incorporates many of the elements of spoken theatre, such as acting, scenery, and costumes and sometimes includes dance...
(he is on the board of the Metropolitan Opera at Lincoln Center), Kovner is an avid collector of rare books and classical music manuscripts and has given millions to art projects and art institutions, notably the Juilliard School
Juilliard School
The Juilliard School, located at the Lincoln Center for the Performing Arts in New York City, United States, is a performing arts conservatory which was established in 1905...
(of which he is Chairman). He is a primary funder of the expansion of Lincoln Center and the publisher of many works, including what some consider the finest modern illustrated bible
Bible
The Bible refers to any one of the collections of the primary religious texts of Judaism and Christianity. There is no common version of the Bible, as the individual books , their contents and their order vary among denominations...
. He is also founder and Chairman of the School Choice Scholarships Foundation, which awards scholarships to financially disadvantaged youth in New York City.
Kovner has contributed extensively to conservative
Conservatism
Conservatism is a political and social philosophy that promotes the maintenance of traditional institutions and supports, at the most, minimal and gradual change in society. Some conservatives seek to preserve things as they are, emphasizing stability and continuity, while others oppose modernism...
causes. He is the former chairman of the board of trustees of the American Enterprise Institute
American Enterprise Institute
The American Enterprise Institute for Public Policy Research is a conservative think tank founded in 1943. Its stated mission is "to defend the principles and improve the institutions of American freedom and democratic capitalism—limited government, private enterprise, individual liberty and...
. His close acquaintances include former Vice President
Vice president
A vice president is an officer in government or business who is below a president in rank. The name comes from the Latin vice meaning 'in place of'. In some countries, the vice president is called the deputy president...
Dick Cheney
Dick Cheney
Richard Bruce "Dick" Cheney served as the 46th Vice President of the United States , under George W. Bush....
, neoconservative figures Richard Perle
Richard Perle
Richard Norman Perle is an American political advisor, consultant, and lobbyist who began his career in government, a senior staff member to Senator Henry “Scoop” Jackson on the Senate Armed Services Committee in the 1970’s...
and James Q. Wilson
James Q. Wilson
James Q. Wilson is an American academic political scientist and an authority on public administration. He is a professor and senior fellow at the Clough Center for the Study of Constitutional Democracy at Boston College....
, as well as a wide range of government officials from all over the world - relationships which many consider contribute to Kovner's insight into commodities markets worldwide. He is a major backer of the conservative Manhattan Institute
Manhattan Institute
The Manhattan Institute for Policy Research is a conservative, market-oriented think tank established in New York City in 1978 by Antony Fisher and William J...
, and The New York Sun daily newspaper.
Further reading
External links
- "The $11 Billion Man," Fortune magazine, September 29, 2003
- "Curated Alpha: Curated Interview With Bruce Kovner From Market Wizards"