David Einhorn
David Einhorn is the Co-Founder and President of Greenlight Capital, a value-oriented investment advisor based in New York City. He quickly rose to prominence during his initial years in the industry due to his prescient bets against Lehman Brothers, Allied Capital, and Green Mountain Coffee. Einhorn has long been considered one of the most successful and closely followed hedge fund managers in the industry. The markets react significantly to his public comments on stocks. The term "Einhorn Effect" was coined based on the significant effect his comments on companies had on investors.
David Einhorn Professional Experience / Academic History
Professional Experience
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Co-Founder and President
Academic History
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BA in Government, Summa Cum Laude
CURRENT APPOINTMENTS
- Chairman of the Board of Greenlight Capital Re
- Chairman of the Board of Green Brick Partners
- Founder and Trustee of the Einhorn Family Charitable Trust
- Member of the Board of Cornell University
- Member of the Board of the Michael J. Fox Foundation for Parkinson’s Research
- Member of the Board of the Robin Hood Foundation
ALLIED CAPITAL
- One of Einhorn's most famous shorts occurred in 2002.
- He accused Allied Capital of accounting fraud.
- He had a short position in Allied Capital and publicly claimed that the firm deceived its shareholders by cooking its books and inflating the price of their assets.
- Allied's fraudulent practice distorted the real value of its stock.
- The day after Einhorn released his suspicions to the public, Allied Capital's share price fell 20%, earning Einhorn a solid win on his short position.
- In 2007, Einhorn recorded his most significant win with his short bet on Lehman Brothers.
- He shared his analysis of Lehman's financial statements.
- He accused Lehman of being involved in dodgy accounting practices that covered up the firm's massive liabilities on asset-backed securities.
- Lehman announced a loss of almost $3 billion after Einhorn publicly announced that he was shorting the company's stock.
- The huge loss publicly validated Einhorn's allegations against the company, and the company went into a free fall.
- Lehman Brothers filed for bankruptcy in September 2008, which was one of the stressors for the stock market crash of that year.