- From the Bronx to billion-dollar ventures: Discovering Yass's passion for finance and probabilities.
- College buddies to trading tycoons: How friendship and a shared love for games changed Wall Street.
- Susquehanna's unique recipe for success: Combining poker strategies with disciplined trading.
From a poker room to the high stakes world of trading, the journey of Jeffrey Yass and his band of college friends is nothing short of legendary. In the swinging 80s, this group who once skipped classes for horse races turned their passion for probability and games into a billion-dollar venture.
The roots of this journey trace back to the Bronx, where a young Yass, mentored by his accountant father, took a keen interest in the world of finance, making his first trade in high school.
At SUNY Binghamton, he met kindred spirits. This group, passionate about math and games, found joy in poker nights and betting at the Monticello race track. But it wasn't all play; Yass penned an insightful paper on horse racing, humorously noting that while he majored in math, poker was his true calling. Post-college, the allure of the poker tables led Yass to Vegas, but a chance encounter with a Comex trader introduced him to market-making. This new interest, combined with a capital infusion from NYU alumnus Izzy Englander, led him back to New York.
1981 was a defining year as Yass bought a seat at the Philadelphia Stock Exchange and began his journey in options trading. Calling back his college mates, they began their trading adventure, also delving into horse and dog racing bets, always on the lookout for the perfect asymmetric bets. Their analytical prowess made them a force to be reckoned with, even leading them to a whopping win of $752,778 at a Miami Jai Alai spot.
But their main game? Trading. And in 1987, the friends established Susquehanna. Named after a river, the firm had a clear strategy – meticulous and disciplined trading, always hedging risks. The group hit gold during the crash of 1987, netting a cool $30 million. This success was just the beginning. Today, they're major players in options trading in the US, even venturing into the startup world with notable investments, like a 15% stake in TikTok's parent company, ByteDance.
At the heart of Susquehanna's success is a unique culture Yass fosters. Emphasizing betting concepts and a calm disposition, the firm recruits sharp minds through poker tournaments and trains them extensively. The fusion of gaming and trading principles has created a distinctive niche for the firm in the financial landscape, proving that for Yass and his team, life's biggest wins come from calculated risks and a love for the game.
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