The Greatest Trade Ever  (English, Paperback, Zuckerman Gregory)

Published in the year 2010, The Greatest Trade Ever: How One Man Bet Against The Markets And Made $20 Billion is a book that documents the success story of John Paulson, from the rough outline of the thesis to its implementation.

Summary Of The Book

Many know John Paulson for his massive success at investing during the crisis. Fund managers, analysts, and traders idolize Paulson, and aim to achieve the same kind of success someday. The Greatest Trade Ever: How One Man Bet Against The Markets And Made $20 Billion provides the readers with key insights into the strategies implemented by Paulson, which led to his success. Paulson is described as a highly practical person who pursued his goal, and achieved it, and not as being a financial deity.

In 2006, Paulson understood that the housing market and the subprime mortgages were inflated greatly, and were on the verge of a major fall. Paulson’s game plan was drafted in a single chart, which was based on the way real estate prices have diverged from their normal pattern throughout history. The chart was developed by Paolo Pellegrini, who was Paulson & Co’s analyst back then. Before becoming a part of Paulson & Co, Pellegrini had a raw deal in the investment industry, and was on the verge of giving up.

Back then, Paulson & Co were a group of individuals who had bad experiences in the past, and weren’t experts at what they did. In this book, the readers are provided insights into the fact that the employees at Paulson & Co were ordinary people and struggled at times, but were determined to achieve their goal. While Zuckerman focuses mostly on Paulson, he also throws light on the lives of Andrew Lahde, Michael Burry, and Jeffrey Greene, who were working together towards achieving this goal. By the end of 2007, Paulson had made more than 15 billion dollars, and even more in 2008. While some traders who followed his game plan exactly found their pockets full, others who goofed up on the timing didn’t achieve any success.

This book came into being as a result of a 50 plus hour interview with Paulson himself, in which he talks about how the thesis came into being, how it was pursued, and the way the trade was put on.

About Gregory Zuckerman

Gregory Zuckerman is an author and journalist. Apart from this book, Zuckerman has written The Frackers: The Outrageous Inside Story of the New Billionaire Wildcatters.

Zuckerman currently works as a journalist for The Wall Street Journal in the Money & Investing section. He completed his degree from Brandeis University in 1988. He is best-known for his column “Heard on the Street”, where he talks about investing, hedge funds, and other Wall Street subjects. He has been associated with The Wall Street Journal for 12 years, and appears twice a week on CNBC to throw light on complex trades. Zuckerman has also been presented with the Gerald Loeb Award twice for covering the fall of Amaranth Advisors, and the demise of WorldCom. He has also received several other awards as well.