David Einhorn - The Long and Short of Investing

**Patrick O'Shaughnessy** (0:00)
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I hosted David on Invest Like the Best last summer and it's hard not to walk away insanely energized after listening to any episode with him. You can find a link to founders and those episodes in the show notes of this conversation. You can also search all past transcripts on our website, joincolossus.com.
Hello and welcome everyone. I'm Patrick O'Shaughnessy and this is Invest Like the Best. This show is an open-ended exploration of markets, ideas, stories and strategies that will help you better invest both your time and your money. Invest Like the Best is part of the Colossus family of podcasts and you can access all our podcasts, including edited transcripts, show notes and other resources to keep learning at joincolossus.com.

**SPEAKER_2** (2:09)
Patrick O'Shaughnessy is the CEO and founding partner of Positive Sum and the CEO of O'Shaughnessy Asset Management. All opinions expressed by Patrick and podcast guests are solely their own opinions and do not reflect the opinion of Positive Sum or O'Shaughnessy Asset Management. This podcast is for informational purposes only and should not be relied upon as a basis for investment decisions.
Clients of Positive Sum or O'Shaughnessy Asset Management may maintain positions in the securities discussed in this podcast.

**Patrick O'Shaughnessy** (2:41)
My guest today is David Einhorn. David is the president of Greenlight Capital, a long short hedge fund that he co-founded in 1996
He is a prominent value investor with a reputation for rigorous security analysis. In 2002, he revealed a short position in Allied Capital, which was ultimately proven correct. And similarly in 2008, he told the Sohn Conference he was short Lehman Brothers. Over his near three decades managing money at Greenlight, he has delivered impressive returns, but it has not been without challenge. Our conversation covers both the highs and the lows, his views on the current banking issues and how he has evolved as an investor. I'm on the planning committee for this year's Sohn Conference where David will be featured with others like Stan Druckenmiller, OpenAI CEO Sam Altman, Stripe CEO Patrick Collison and Bridgewater CIO Karen Carniol-Tambor. If you've enjoyed Invest Like the Best and are willing to contribute to a great cause, in this case Memorial Sloan Kettering Cancer Center, I deeply appreciate you buying a ticket at the link available in the show notes and join us in May for what will be an incredible day of business and investing presentations and interviews. Now, please enjoy My Great Conversation with David Einhorn.
David, my first question for you is kind of a market conditions and composition question. This may sound like a stupid question, but I still want the answer. If you could start a fund in the pursuit of Alpha today or in 1996 as you did, when would you start it?

**David Einhorn** (4:07)
I think I would start it in 1996 I didn't know it at the time, but it was a fabulous environment for what I like to do, which is trying to figure out what things are worth and buy them before other people figure out that they're worth so much and argue with the market about misvaluations.
And in 1996, there was a very vigorous active debate about those kinds of things. It played really nicely into my view of things and my skill set and things like balance sheets mattered and stuff like that. And if I could read them a little bit quicker than some other people or understood them a little bit better, I had a pretty sustainable advantage. And sitting here today, that advantage is not there anymore. That's gone.