Product Description

New chapter by Soros on the secrets to his success along with a new Preface and Introduction.
New Foreword by renowned economist Paul Volcker
"An extraordinary . . . inside look into the decision–making process of the most successful money manager of our time. Fantastic." –The Wall Street Journal
George Soros is unquestionably one of the most powerful and profitable investors in the world today. Dubbed by BusinessWeek as "the Man who Moves Markets," Soros made a fortune competing with the British pound and remains active today in the global financial community. Now, in this special edition of the classic investment book, The Alchemy of Finance, Soros presents a theoretical and practical account of current financial trends and a new paradigm by which to understand the financial market today. This edition′s expanded and revised Introduction details Soros′s innovative investment practices along with his views of the world and world order. He also describes a new paradigm for the "theory of reflexivity" which underlies his unique investment strategies. Filled with expert advice and valuable business lessons, The Alchemy of Finance reveals the timeless principles of an investing legend.
This special edition will feature a new chapter by Soros on the secrets of his success and a new Foreword by the Honorable Paul Volcker, former Chairman of the Federal Reserve.
George Soros (New York, NY) is President of Soros Fund Management and Chief Investment Advisor to Quantum Fund N.V., a $12 billion international investment fund. Besides his numerous ventures in finance, Soros is also extremely active in the worlds of education, culture, and economic aid and development through his Open Society Fund and the Soros Foundation.

Product Details

• Amazon Sales Rank: #87485 in Books
• Published on: 2003-08-19
• Original language: English
• Number of items: 1
• Binding: Paperback
• 416 pages

Review
“…contains a detailed description of his trading methods and repays careful reading.” (Investors Chronicle, 1st April 2005)

“…these updated classics are packed with investment wisdom…” (What Investment, November 2003)

From the Back Cover
Critical Praise forThe Alchemy of Finance

"The Alchemy of Finance joins Reminiscences of a Stock Operator as a timeless instructional guide of the marketplace."
––Paul Tudor Jones
From the Foreword to the First Edition

"An extraordinary . . . inside look into the decision–making process of the most successful money manager of our time. Fantastic."
––The Wall Street Journal

"A breathtakingly brilliant book. Soros is one of the core of masters . . . who can actually begin to digest the astonishing complexity . . . of the game of finance in recent years."
––Esquire

"A seminal investment book . . . it should be read, underlined, and thought about page by page, concept by idea. . . . He’s the best pure investor ever . . . probably the finest analyst of the world in our time."
–– Barton M. Biggs
Director, BKF Capital Group, Inc.

Updated to include a new Preface and Introduction by Soros, and a Foreword by Paul A. Volcker

George Soros is unquestionably the most powerful and profitable investor in the world today. Dubbed by BusinessWeek as "The Man Who Moves Markets," Soros once made a billion dollars by betting that the British pound would be devalued. Soros is not merely a man of finance, but a thinker to reckon with as well. In The Alchemy of Finance, this extraordinary man reveals the investment strategies that have made him "a superstar among money managers"(The New York Times).

About the Author
GEORGE SOROS is Chairman of Soros Fund Management, which serves as the principal investment advisor to the multibillion dollar Quantum Group of Funds. Soros’s flagship Quantum Fund is recognized as the most successful investment fund ever, returning an average 31 percent annually for more than thirty years. Soros has been an important philanthropist since 1979. His charitable foundations are active in more than fifty countries and spend nearly half a billion dollars each year to support projects in education, public health, civil society development, human rights, and many other areas.

Customer Reviews

Wizard of Finance
Soros explains here his key analytical principle of reflexivity - essentially a positive feedback loop - in the context of boom-bust cycles in financial markets and economies, and its applications in his extraordinarily successful "global macro" trading system during the 1970s, 80s, and early 90s.

He gives unique contrarian insights into our understanding of supposedly cut-and-dried economic and financial ideas, such as his trenchant denial of the efficient markets hypothesis and financial markets equilibria. He draws surprising links between economic phenomena which hitherto were supposed to be independent of each other, the best example being his emphasis on the propensity for bank lending to reflexively influence the collateral values of the financial assets which it finances in such a way as to lead to a boom-bust cycle.

That mainstream economists would quibble with Soros's ideas are to be expected, for economists are known for being unreasonably disputatious and uncommonly sensitive to outsiders' criticisms of their theoretical sacred cows. But in the analysis of market trends and dislocations, and trading opportunities, I know where I would put my money, given a choice between academic economists and Soros.

Success speaks for itself. Soros applied his theories so successfully that he became the most successful hedge fund manager ever, his flagship Quantum Fund generating an average annual return of 30%+ between 1969 and 1995.

One cannot but admire his tremendous courage, for example, in taking on the Bank of England and breaking its back, as it were, in his famous 10 billion dollar Sterling short trade in 1992 which netted him a cool billion, and made him a legend among traders and feared by central bankers worldwide. His honesty in admitting his missteps, and coolness with which he analysed his failures, is equally impressive, and sets an example for all professional investors.

George Soros is a not just a legend, but a genius with one of the finest analytical minds of his time. He elevated trading to a fine art, an alchemy of which he was an inimitable wizard.

Not all lead turns into gold
Probably this book went way over my head.

The one insight I think I got from it was that during the tech boom, many of the new products were appearing, not because of some fundamental increase in the rate of innovation brought on by the Web, but because of all the money pouring into startups because investors believed the Web would lead to such innovations for technological reasons. A phenomena Soros calls "reflexivity", I guess. But even without knowing that it seemed clear a boom was in progress that would eventually bust. But how to know when? It doesn't seem this book or Soros could tell you.

I hear Soros became a billionaire through his investments and that seemed well beyond a chance event, but I didn't understand anything in this book to explain how that happened. Speculations about global politics and finance, then a big dash of intuition, and then at times a gain, at times a loss. I don't follow in Soros's case why his gains exceeded his losses. There are others who don't believe in unbiased marketes, why didn't they similarly profit to such an extent. And just knowing that markets are biased, how does it tell you how to time? Perhaps Soros benefitted from adjusting his market positions quickly if his assumptions weren't confirmed by the market: would that help and to such an extent?

It's not clear to me that Soros' explanations in this book are closely related, if at all, to his successes. It may be helpful to be exposed to his mindset, if this book does that, but, after finishing it, it isn't clear how to apply what I've read. I won't not recommend this book, because I may very well be missing a lot of what it says. Other people's books may not make you a billionaire. But I haven't figured out whether this one will make me one or even allow me to pay for a new car. "The Alchemy of Finance" seems to be about bold gambling I wouldn't want to do with any money I may someday need.