Louis Moore Bacon is notably one of the best hedge fund managers and traders to ever play the global markets. Though super secretive, both his wildly successful hedge fund, Moore Global Investments, and his land conservation efforts, have thrust him into the media spotlight.
Besides overseeing about $15 billion in assets, Bacon keeps busy with his amazing land holdings and his large family.
In 1956, Bacon was born in Raleigh, North Carolina.
Louis' father founded a Raleigh, NC real estate company called Bacon & Co., which was later bought by Merrill Lynch.
He grew up spending his time hunting and fishing in the mid-Atlantic region.
While in his 20s, his mother died and his father remarried to the sister of the legendary Julian Robertson of Tiger Management.
He spent his spare time hunting deer in the mountains of Vermont.
Louis Bacon received his MBA from New York's Columbia Business School in 1981.
While at Columbia, Bacon tried trading some of the money he had received from a low-interest loan. He lost money during the first three terms, as he placed losing bets on sugar, gold and cotton contracts. After needing to borrow money from his parents for to pay for necessities, Bacon finally turned a profit during his fourth semester.
In 1981, Bacon entered the sales and trading training program at Bankers Trust.
In 1982, Bacon's commodity trading mentor committed suicide after losing his net worth by shorting the S&P 500 index.
In a interview with Forbes, Bacon said:
I saw the utter agony and fruition of sticking with a losing position.
Soon after working for Walter Frank, Bacon took a job as a futures broker at Shearson Lehman Brothers where he later became a senior vice president. Louis' brother Zack, a trader for George Soros and some of Louis' friends, traded through his futures desk.
He briefly tried his luck at managing money again in 1985 for Commodities Corp., but lost one third of the $100,000 he was given to trade.
In 1986, Louis married Cynthia Pigott, a staff reporter for Newsweek magazine.
During the mid 1980s, Bacon met the fellow southerner, Paul Tudor Jones, through a friend of his brother Zach.
The two young traders took on the 1980s New York social scene as young bachelors.
Today, the two massively successful and wealthy hedge fund managers reportedly speak a few times per week.
Bacon launched his own fund, Moore Capital Management, in 1989 and it had a incredible first year — up 86%
Soon after Bacon launched his first fund, his friend, Paul Tudor Jones, stopped accepting new investors, so he recommended to his investors that they should invest in Bacon's Moore Global Investments.
During 1990, his first year, Bacon correctly predicted how Saddam Husein and the first Gulf War would impact oil prices. Bacon also successfully shorted the Nikkei index, ending 1990 up an incredible 86%.
In 1992, Bacon created the Moore Charitable Foundation to distribute financial donations to nonprofit organisations that support land and water conservation.
In 1993, Bacon's fund was up 50% and issued its first cash distribution of $470 million.
But, in 1994, Bacon's fund was hit by the collapse of the German bond market and his fund closed out the year down about 14%. The down year scared many investors away, and Bacon reportedly lost 90% of his client base.
Bacon quickly rebounded, and by 1996 he had expanded his London and New York offices.
He prefers to trade from his London office, because it has the best time zone to trade in the world's markets. And before the internet, Bacon had copies of Barron's flown from New York to his London office every weekly.
Louis' older brother Zack, who had traded for George Soros, joined Moore in 1998.
In 2000, Bacon launched several new funds under Moore Capital Management, further diversifying his firm's global macro themed funds.
The 9/11 attacks, the Enron scandal and Argentina's default suppressed markets and his portfolios during the early 2000s, frustrating Bacon and his investors.
However, by 2003, Bacon had over $8 billion in assets under management.
As well-known as Bacon is in trading circles, he's little known outside of them. That's partly because he is good at controlling his own exposure, with suspicion that can verge on paranoia. A former Moore employee recalls a day in 1991 when James Kelly, Moore's president at the time, strolled through the office with a private detective who carried a box that had a TV-like antenna and blinking lights, sweeping for bugs. Staffers won't even tell you whether Bacon's in town. He's serious about confidentiality agreements and not above some intimidation. 'If I talk, only bad things can happen,' says James Capra of hedge fund Capra Asset Management in New York.
Currently, Bacon is married to his second wife, Gabrielle de Heinrich Sacconaghi, an advisor to art buyers from Montrèal. The couple married in 2007, and now live in New York so that their kids may attend schools in the US.
Bacon relies on his assistant to help him deal with his children's' finances, many of which are split between two currencies in two countries.
Bacon purchased the 435-ace Robins Island in 1993, located just north of Southampton on Long Island for $11 million.
In 1998, he purchased the 540-acre Cow Neck Farm in Southampton, NY for $25 million.
Soon after purchasing the Long Island properties, Bacon gave conservation easements to local organisations, ultimately protecting the land from development, while saving millions of dollars from the charitable deductions.
It has been reported that Bacon, who has a passion for hunting and fishing, hosts pheasant hunts on Robins Island.
Located near the massive Trinchera Ranch, is another one of Bacon's ranches, the Blanca Ranch.
Together, the two ranches occupy about 172,000 acres and as of June 2012, Bacon intends to donate 90,000 acres of that to conservation, protecting the land from future development. Bacon's donation to the US Fish and Wildlife Service, will be the largest single conservation easement in the organisation's history.
Through Louis Bacon's Moore Charitable Trust, he has provided funding to over 100 environmental organisations that support the conservation of land and water.
In 2011, Bacon put his troubled estate in the Bahamas on the market for $35 million.
Also during 2010, Bacon's Bahamas home was raided, and police discovered four military grade speakers. Investigators suspected that the speakers, which can cause structural damage and even death, were being used to annoy Bacon's neighbour, fashion designer and businessman Peter Nygard.
In one of the largest financial penalties in the history of the Commodity Futures Trading Commission, Moore was fined $25 million for neglecting to supervise a trader who manipulated palladium and platinum futures in 2010.
Besides the investigations, there have been several big traders who have left Moore during the last few years to start their own hedge funds, a common issue that all funds face.
Someone close to Moore was quoted by CNN Money saying:
He (Bacon) can have a different team every year and they can still win the World Series.
In August 2012 Bacon announced he would return $2 billion to investors because of the volatile market.
On August 1, 2012, Bacon announced that he would return $2 billion to his investors from Moore's approximately $15 billion in assets under management. Bacon is reducing his total assets because he believes that politics have been disrupting basic economic factors and that there are not enough profitable investment opportunities.
As of July 1, 2011, Moore Global investments employs 429 employees in offices in New York, Washington, D.C., London, Zurich and Hong Kong.
In early 2012, Louis' older brother Zack Bacon returned to Moore as a managing director dealing with the firm's strategic planning.
Bacon may have plans to significantly shrink Moore into a family office something like George Soros'.
New financial regulations from Dodd-Frank now require hedge funds like Moore to provide details to the SEC about trading and risk management, and Bacon is not happy to reveal the secrets to his firm's inner workings.
Many believe that Bacon may transform Moore into a smaller, family office, that manages his personal wealth. Several other top hedge fund managers, like Druckenmiller and George Soros, have downsized their firms to the family office status.
However, with a net worth of $1.4 billion in 2012, down from $1.8 billion in 2008, Bacon significantly relies on outside investors for funding. George Soros, with a net worth of $20 billion, has a much different family office situation.
Despite Bacon's poor years, his flagship fund has averaged returns since 1989 of 18.8%.
During this fall's presidential elections, Bacon will be rooting for Mitt Romney, and has already contributed over $175,000 to the republican party.
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