Daniel S. Och Firm: Och-Ziff Capital Management Group Headquarters: New York Earnings: $170 million
Daniel S. Och Firm: Och-Ziff Capital Management Group Headquarters: New York Earnings: $170 million The performance of Och-Ziff’s Master Fund was flat in 2011, but the firm’s stock price took a disproportionate beating, falling 37% over the year. It wasn’t all bad for the company’s namesake, however, who earned $1.07 in cumulative dividends per share in 2011, much of which was the bounty of a good 2010. Och’s firm manages $29 billion and its founder is cautiously optimistic heading into 2012, seeing opportunity in Asian equities where macroeconomic conditions have depressed market prices below fundamental values.
Trader: Seeks to exploit short-term volatility in the price of a security. The trader need not have an opinion on the merits of a company whose stock he trades, or the appropriateness of a particular exchange rate—just an opinion on the short-term direction of the securities.
Stock Picker: Differs from the trader in that stock pickers tend to analyze a company’s (or an industry’s or a country’s) fundamental business and make informed bets on their future direction. Tends to hold positions longer than a trader. Activist stock pickers try to personally intervene in company affairs. CEOs hate them.
Distressed Investor: Buys and sells the securities of companies in trouble, where there tends to be larger-than-usual differences of opinion over the relative merits of a stock or bond. Can also become an activist and attempt to take control of a company by buying a majority of its equity or, in bankruptcy, its debt.
Quantitative Investor: Generally relies on software-driven models that analyze historical trading patterns to inform current investment decisions, seek out price inefficiencies, or crunch financial-statement data in order to determine a theoretical price. It’s all numbers, no guts.