Bill Lipschutz – One Of The Most Successful Forex Traders

By | October 6, 2021

Bill Lipschutz

Bill Lipschutz, the co-founder and director of portfolio management at Hathersage Capital Management, is one of the most successful individuals in forex trading. Lipschutz was born and raised in Farmingdale, New York. He earned excellent grades throughout his educational career in junior high and high school. Maths was one of his favourite subjects. He also had an interest in tennis and became a devoted tennis player.

Bill attended Cornell University where he earned his Bachelor’s degree in Fine Arts from the Architectural Design program. He was simultaneously enrolled in business classes. In 1982, Lipschutz earned an MBA in finance from the Johnson School of Management at Cornell University.

His career as a forex trader started accidentally. While he was studying at Cornell University, Bill inherited $12,000 worth of stock after the death of his grandmother. He had more than 100 different stocks in various locations in his inheritance. He had to pay a substantial amount of fees to liquidate and consolidate the risk capital into one location.

Lipschutz started investing the risk capital in his free time while attending school. He spent hours in the library to read and research everything possible related to the market. While researching, his interest in financial trading grew, and eventually, his portfolio was worth close to $250,000. However, this great success did not live long because one bad decision and a turn on the market made the risk capital virtually blown. Lipschutz did not give up though. Instead, he considered this loss a valuable learning experience to apply to his future investments. Through his college career, he became more interested in stock trading. To pursue stock trading, he left his architectural degree behind.

Lipschutz met his wife Lynnelle Jones during the time he spent at Cornell. She was working as a research assistant for economist Henry Kaufman. Bill interned for Kaufman and Salomon Brothers and then he graduated in 1982. Afterwards, he joined Salomon Brothers full-time in May 1982.

During a Salomon Brothers training program, Bill was asked to be a part of the newly formed foreign exchange department. The institution gathered its brightest traders to create a team and came up with a plan to learn currency trading and hit the running market.

At the same time when Salomon Brothers were jumping into the forex market, the market took off. Bill Lipschutz became a powerhouse with the Philadelphia Stock Exchange, where most of the forex trading took place. He had 50% of all the currency option volume on the Philadelphia Stock Exchange at the peak of his career. He also had 80% of all open interest option. The world considers him one of the top five forex traders. He started making $300 million per year for Salomon Brothers by 1985.

Bill was the main trader for the institution’s propriety foreign exchange account from 1984 to June 1990, when he left. He was appointed a director of Salomon Brothers in 1988, heading the New York Foreign Exchange Trading Desk and the Global Foreign Exchange Options Group. Afterwards, he was named the managing director and global head of foreign exchange in 1989.

In spite of his huge successes, Lipschutz left Salomon Brothers because he felt that it was becoming too big which was making it lose its appeal as a cultural institution. So, he decided to take early retirement. However, it did not last long. Currency trading was becoming bigger and pulling in more profits than stocks or bonds. So, Bill took it on.

In 1990, Lipschutz briefly joined as the President and CEO for the North Tower Group, which was a subsidiary of the Merrill Lynch Corporation. After that, he established Rowayton Capital Management, an asset and management firm. He was the President and CEO of this firm until 1995.

Lipschutz formed Hathersage in 1995 with his former Cornell classmates. It is a currency hedge fund management company. The 200 million dollar company manages only fourteen investors. Together with his wife and his friends, there are seven employees at Hathersage. They run the company from their homes. Each employee has a very specific role in the company and its day-to-day operations in order to make it successful.

In his lifelong career of trading, Bill Lipschutz received tons of awards and recognition. He was welcomed into the Trader Monthly Hall of Fame in October 2006. He has also been featured in two books on exceptional market traders. The first one is ‘The New Market Wizards: Conversations with America’s Top Traders’ written by Jack D. Schwager in 1992. It features many of the top market traders from the 1980s and 1990s. The second book Bill Lipschutz has been featured in is ‘The Mind of a Trader: Lessons in Trading Strategy from the World’s Leading Traders’ written by Alpesh B. Patel in 1998.

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