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Ken Griffin, financial prodigy turned industry giant


Virtually four many years in the past, the South Florida Sunshine-Sentinel profiled three precocious customers of the Boca Raton Group Higher School’s pc club. When their classmates have been shooting hoops, the “disc-travel driven trio” had been prepping for a challenge-fixing levels of competition with other Palm Seashore geeks later that month.

It is unclear what transpired with Satish Vadapalli and Wayne Wong, who worked out the challenges with pen and paper right before passing on methods for their 3rd member to bash into a laptop. But the latter would go on to go away a important mark on the financial planet.

Kenneth Cordele Griffin is currently a person of the world’s wealthiest men and women, with a fortune approximated at $26.5bn by Forbes. He is generally acknowledged for working his $40bn Chicago-dependent hedge fund Citadel. But in fact, his lesser-recognised but arguably a lot more essential computer system-driven buying and selling company Citadel Securities is now the most important key to his wealth — and mounting controversy.

This week Griffin marketed a $1.15bn stake in Citadel Securities to undertaking funds companies Sequoia Money and Paradigm, electrifying the finance sector. The company is the world’s most significant algorithmic “market-maker”, handling above a quarter of all US stocks bought and offered each working day. Now it is eyeing cryptocurrencies, and a very likely first general public presenting.

The offer valued Citadel Securities at $22bn, adding $5bn to Griffin’s net truly worth and lifting him to 26 in the Forbes desk of the richest People in america. Quite a few fellow financiers had been agog at the offer.

“What made Michael Jordan Michael Jordan is not just that he jumps increased and runs faster, he’s sui generis. Ken is related in his industry,” suggests Lloyd Blankfein, the previous main executive of Goldman Sachs and a good friend of Griffin. “He’s a terrific trader, but he’s also a great businessperson, and people items really do not usually go jointly. It’s like a runner who wins in each the 100m sprint and a marathon.”

Even so, Griffin has also become a magnet for ire. For some he embodies the finance field and its meant ills. In Chicago his political machinations increase hackles. Conspiracy-minded retail buyers on internet discussion boards these as WallStreetBets portray him as the malevolent head of an evil financial empire, even however the US monetary watchdog debunked their promises.

Internally, Griffin is additional respected than cherished, and the tradition is said to be brutally intense, even for Wall Street.

“There’s not a ton of empathy,” a single former worker advised the FT past 12 months. “That can be an asset when items are going nuts, as I do not imagine he feels pressure the same way as anyone else. There is just this want to be the most effective at everything, and every person is possibly aiding him complete that, or not.”

In an FT interview past calendar year, replete with the long pauses and totally-shaped clipped sentences he speaks in, Griffin shrugged off this sort of complaints: “If you are wired to get pleasure from being a superior competitor, you like operating below,” he reported.

There had been a several hints of Griffin’s towering generate in the Sunshine-Sentinel profile. The 17-12 months outdated — captured in spectacles, a disheveled stripy shirt and vintage zip-up Adidas jacket — was presently a prodigy at the time.

Energetic in the personal computer club, he was also president of the maths club and a budding entrepreneur. The center-class teen experienced established up a mail-get software package organization advertising academic programmes to faculty professors out of his household, which allowed him to cover his youth from prospects.

His to start with dalliance with finance arrived in 1980, when the 11-yr aged Griffin wrote a college paper on how he prepared to examine the inventory market place. Nonetheless it was as a Harvard undergraduate that he initial commenced buying and selling aggressively, famously convincing his dormitory to permit him install a satellite dish so he could get up-to-day inventory charges.

The dish was mounted just in time for the Black Monday crash of 1987, when Griffin was already handling $265,000. Fortunately, he was betting on shares falling, and created a killing. Griffin’s returns captivated the attention of hedge fund pioneer Frank Meyer, who bankrolled the launch of Citadel.

By 2001, Institutional Trader declared him the “boy surprise” of his marketplace. “Griffin is to hedge resources what pimply faced dotcom billionaires had been briefly to the Online: the boy god, nerd produced great, self-taught polymath of finance,” it wrote. A few decades later on, it all almost arrived crashing down.

Despite a popularity for preventing faults, Citadel misplaced an astonishing $8bn in the money disaster. It was inevitably compelled to freeze trader withdrawals, normally a demise knell.

Alternatively, Griffin resurrected Citadel as a person of the hedge fund world’s undisputed giants, spun out its significant-frequency buying and selling arm as Citadel Securities and crafted it into a formidable firm in its have proper. In 2020 Citadel sat fourth on the list of the best-grossing money of all time, with cumulative gains for investors of about $42bn, when Citadel Securities churns out earnings from the retail trading growth.

There are handful of indicators that Griffin is particularly worried by the opprobrium of world-wide-web message boards. When countless numbers of cryptocurrency fanatics gathered more than $40m to invest in a scarce 1st-version copy of the US Structure previous year, he outbid them on a whim, leading to outrage. The profitable bid of $43.2m amounted to considerably less than a few days of Citadel Securities’ investing revenues.

“2008 virtually introduced him down, and he’s rebuilt like a magician. It’s phenomenal,” stated one hedge fund executive. “He’s kind of like the Elon Musk of revenue.”

robin.wigglesworth@ft.com



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