Bull Bear Report Mar 11 2010

Finance Pros Among World's Billionaires

By julie steinberg

Forbes released its annual list of the world's billionaires, and to no one's surprise, several finance pros make the list. We investigated those who appeared highest on the list to see how they climbed the lofty peak of billionaire-hood.

3. Warren Buffett, $47 billion

Buffett dropped this year from #2 to #3 on the Forbes list, but falling is relative when it comes to being mega-rich. Berkshire Hathaway had a spectacular 2009, with its book value increasing 19.8% to $21.8 billion. Buffett invested $5 billion in Goldman Sachs in 2008, and the collusion of powerhouses resulted in even more wealth to go around.

While some of Buffett's decisions have been met with confusion, like the decision to purchase Burlington Northern Sante Fe, it's generally agreed upon that he knows what he's doing. He's known for prudence and caution, which have stood him well, and, based on the accuracy of his past predictions, his latest decision to invest in green tech should be taken as a lesson to all investors.

The career lesson here is to be able to predict the future -- it seems to have worked for Buffett!

35. George Soros, $14 billion

A Hungrian Jew who survived the Holocaust by posing as the Ministry of Agriculture's godson, Soros landed a scholarship to LSE and started at a bank in London shortly after graduating. He launched Quantum Fund in 1969 and now heads up Soros Fund Management.

What differentiates Soros from the cohort of hedge fund managers is his high political profile: He's donated millions to NGOs in former Soviet Union countries. He came out of retirement in 2007 and increased the value of his fund by 8% in 2008, a year when many fund managers lost it all.

If there's one thing Soros' experiences show, it's that adaptation is necessary to get what you want.

45. John Paulson, $12 billion

Paulson is perhaps the best example of going against the grain and getting rewarded for it. He bet against subprime mortgages in 2007 and is now laughing all the way to the bank. Paulson Advantage Fund returned 38% in 2008, and he manages $32 billion in assets. Right now he's betting on gold, to the amusement of some detractors. Sometimes, it pays to follow your gut.

48. Abigail Johnson, $11.5 billion

Johnson controls Fidelity Investments, the country's largest mutual fund company, with her father. The firm is a jack of all trades: It also has a brokerage business and insurance outfit.

After attending Williams and Harvard Business School, Johnson ran her first diversified fund in 1993. She served as an equity portfolio manager from 1988 until 1997, and was then promoted to an executive role at the firm. She currently heads up Fidelity Institutional Retirement Services.

While the notoriously media-shy mogul won't discuss succession plans, her route to the top shows that nepotism can get you a start, but it won't get you to the top. Johnson worked her way up from day one.

113. Steve Cohen, $6.4 billion

The founder of SAC Capitalgot an early start: He played poker in high school and used the profits -- $7,000 meant for college tuition -- to open a brokerage account at Gruntal & Co. and start trading. He founded SAC in 1992 and now manages $12 billion in assets. His managing style is slightly different than other hedgies; he sits in the center of the floor all day from 8 a.m. onward, and his movements are recorded on camera to be broadcast to those who can't see him. Call it narcissistic, but the hands-on approach seems to have worked: The firm's main fund was up 28.4% after falling 18.5% in 2008. He also famously keeps the trading floor to 70 degrees to keep traders alert.

Write to Julie Steinberg

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