David Tepper
Encyclopedia
David Alan Tepper is an American
hedge fund
manager and the founder of Appaloosa Management
. His investment
specialty is distressed companies.
In recent years he's become known as a philanthropist
, his largest gift going to Carnegie Mellon University
, whose Tepper School of Business
is named after him. He earned his MBA (then known as an MSIA) from Carnegie Mellon in 1982.
in the East Liberty
neighborhood of Pittsburgh
, Pennsylvania
. At the University of Pittsburgh
he paid his way through school by working at the Frick Fine Arts library. He graduated with honors receiving his Bachelor of Arts
degree in Economics
. He also dabbled in the markets during college.
After graduation he entered the finance
industry working for Equibank as a Credit Analyst
in the Treasury
department. In 1980, unsatisfied with this position he enrolled at Carnegie Mellon University
's business school to pursue its then version of an MBA, a Master of Science in Industrial Administration
(MSIA).
in Ohio
.
In 1984, he was recruited to Keystone Mutual Funds (now part of Evergreen Funds
) in Boston, and in 1985, Tepper was recruited by Goldman Sachs
, which was forming its high yield group. He joined the firm in New York City as a credit analyst. Within six months, Tepper became the head trader on the high-yield desk at Goldman where he worked for eight years. His primary focus was bankruptcies and special situations. He left Goldman in December 1992 and started Appaloosa Management
in early 1993.
In 2001 he generated a 61% return by focusing on distressed bonds, and in the fourth quarter of 2005 he pursued what he saw as better opportunities in Standard & Poor's
500 stocks.
He makes significant gains year after year by “investing in the diciest of companies,” such as MCI and Mirant
. Investments in Conseco
and Marconi also led to huge profits for the company’s hedge funds while Tepper “keeps the market on edge.”
In 2009, Tepper's hedge-fund firm earned about $7 billion by buying distressed financial stocks (including acquiring Bank of America
common stock at $3 per share) in February and March of that year and profiting from recovery of those stocks,with $4 billion of these profits going to Tepper's personal wealth. In March 2010, the New York Times reported that Tepper's success made him the top-earning hedge fund manager in the world in 2009, and in 2010 he was ranked by Forbes
as the 258th richest person in the world.
. Tepper currently serves as a member of the Business Board of Advisors for the Tepper School of Business at Carnegie Mellon and serves on various boards and committees for charitable and community organizations in New York and New Jersey. On September 25, 2009, Tepper purchased a portion of the Pittsburgh Steelers
.
He is against teacher's unions.
.
Tepper also has made several large gifts to the University of Pittsburgh, including several endowed undergraduate scholarships and support of academic centers and university-run community outreach programs.
David A. Tepper and wife Marlene have pledged $3.4 million to Rutgers University - Mason Gross School of the Arts, the alma mater of his wife.
United States
The United States of America is a federal constitutional republic comprising fifty states and a federal district...
hedge fund
Hedge fund
A hedge fund is a private pool of capital actively managed by an investment adviser. Hedge funds are only open for investment to a limited number of accredited or qualified investors who meet criteria set by regulators. These investors can be institutions, such as pension funds, university...
manager and the founder of Appaloosa Management
Appaloosa Management
Appaloosa Management is an American hedge fund founded in 1993 by David Tepper and Jack Walton specializing in distressed debt. Appaloosa Management invests in public equity and fixed income markets around the world.-History:...
. His investment
Investment
Investment has different meanings in finance and economics. Finance investment is putting money into something with the expectation of gain, that upon thorough analysis, has a high degree of security for the principal amount, as well as security of return, within an expected period of time...
specialty is distressed companies.
In recent years he's become known as a philanthropist
Philanthropist
A philanthropist is someone who engages in philanthropy; that is, someone who donates his or her time, money, and/or reputation to charitable causes...
, his largest gift going to Carnegie Mellon University
Carnegie Mellon University
Carnegie Mellon University is a private research university in Pittsburgh, Pennsylvania, United States....
, whose Tepper School of Business
Tepper School of Business
The Tepper School of Business is a private business school located on Carnegie Mellon University’s campus in Pittsburgh, Pennsylvania, USA.The school consistently ranks highly among the top business schools in the U.S., as well as in a wide range of specializations, such as finance,...
is named after him. He earned his MBA (then known as an MSIA) from Carnegie Mellon in 1982.
High school and college
Tepper was raised in the East End of Pittsburgh in the city section known as Stanton Heights and attended Peabody High SchoolPeabody High School
Peabody High School is a public school in Pittsburgh, Pennsylvania, USA, in the neighborhood of East Liberty, The school opened in 1911 after the renovations of a former elementary school and was rededicated after Highland Park doctor Benjamin Peabody. After 100 years in operation the school...
in the East Liberty
East Liberty
The following places are named East Liberty:* East Liberty, Ohio* East Liberty , a neighborhood of Pittsburgh* East Liberty , a novel by Joseph Bathanti set in the Pittsburgh neighborhood of the same name...
neighborhood of Pittsburgh
Pittsburgh, Pennsylvania
Pittsburgh is the second-largest city in the US Commonwealth of Pennsylvania and the county seat of Allegheny County. Regionally, it anchors the largest urban area of Appalachia and the Ohio River Valley, and nationally, it is the 22nd-largest urban area in the United States...
, Pennsylvania
Pennsylvania
The Commonwealth of Pennsylvania is a U.S. state that is located in the Northeastern and Mid-Atlantic regions of the United States. The state borders Delaware and Maryland to the south, West Virginia to the southwest, Ohio to the west, New York and Ontario, Canada, to the north, and New Jersey to...
. At the University of Pittsburgh
University of Pittsburgh
The University of Pittsburgh, commonly referred to as Pitt, is a state-related research university located in Pittsburgh, Pennsylvania, United States. Founded as Pittsburgh Academy in 1787 on what was then the American frontier, Pitt is one of the oldest continuously chartered institutions of...
he paid his way through school by working at the Frick Fine Arts library. He graduated with honors receiving his Bachelor of Arts
Bachelor of Arts
A Bachelor of Arts , from the Latin artium baccalaureus, is a bachelor's degree awarded for an undergraduate course or program in either the liberal arts, the sciences, or both...
degree in Economics
Economics
Economics is the social science that analyzes the production, distribution, and consumption of goods and services. The term economics comes from the Ancient Greek from + , hence "rules of the house"...
. He also dabbled in the markets during college.
After graduation he entered the finance
Finance
"Finance" is often defined simply as the management of money or “funds” management Modern finance, however, is a family of business activity that includes the origination, marketing, and management of cash and money surrogates through a variety of capital accounts, instruments, and markets created...
industry working for Equibank as a Credit Analyst
Financial analyst
A financial analyst, securities analyst, research analyst, equity analyst, or investment analyst is a person who performs financial analysis for external or internal clients as a core part of the job.-Job:...
in the Treasury
Treasury
A treasury is either*A government department related to finance and taxation.*A place where currency or precious items is/are kept....
department. In 1980, unsatisfied with this position he enrolled at Carnegie Mellon University
Carnegie Mellon University
Carnegie Mellon University is a private research university in Pittsburgh, Pennsylvania, United States....
's business school to pursue its then version of an MBA, a Master of Science in Industrial Administration
Master of Science in Industrial Administration
The Master of Science in Industrial Administration historically has been a professional Master's degree that provides training in management and business administration....
(MSIA).
Career
After earning his MBA in 1982, Tepper accepted a position in the treasury department of Republic SteelRepublic Steel
Republic Steel was once the third largest steel producer in the United States.The Republic Iron and Steel Company was founded in Youngstown, Ohio in 1899....
in Ohio
Ohio
Ohio is a Midwestern state in the United States. The 34th largest state by area in the U.S.,it is the 7th‑most populous with over 11.5 million residents, containing several major American cities and seven metropolitan areas with populations of 500,000 or more.The state's capital is Columbus...
.
In 1984, he was recruited to Keystone Mutual Funds (now part of Evergreen Funds
Evergreen Investments
Evergreen Investments was the investment management business of Wachovia. The brand was merged into Wells Fargo Advantage Funds and subsequently phased out following Wells Fargo's acquisition of Wachovia...
) in Boston, and in 1985, Tepper was recruited by Goldman Sachs
Goldman Sachs
The Goldman Sachs Group, Inc. is an American multinational bulge bracket investment banking and securities firm that engages in global investment banking, securities, investment management, and other financial services primarily with institutional clients...
, which was forming its high yield group. He joined the firm in New York City as a credit analyst. Within six months, Tepper became the head trader on the high-yield desk at Goldman where he worked for eight years. His primary focus was bankruptcies and special situations. He left Goldman in December 1992 and started Appaloosa Management
Appaloosa Management
Appaloosa Management is an American hedge fund founded in 1993 by David Tepper and Jack Walton specializing in distressed debt. Appaloosa Management invests in public equity and fixed income markets around the world.-History:...
in early 1993.
In 2001 he generated a 61% return by focusing on distressed bonds, and in the fourth quarter of 2005 he pursued what he saw as better opportunities in Standard & Poor's
Standard & Poor's
Standard & Poor's is a United States-based financial services company. It is a division of The McGraw-Hill Companies that publishes financial research and analysis on stocks and bonds. It is well known for its stock-market indices, the US-based S&P 500, the Australian S&P/ASX 200, the Canadian...
500 stocks.
He makes significant gains year after year by “investing in the diciest of companies,” such as MCI and Mirant
Mirant
Mirant Corporation, an Atlanta-based energy company, produces and sells electricity in the United States. The company was spun off from its former parent, Southern Company, on April 2, 2001...
. Investments in Conseco
Conseco
Conseco , originally Security Life of Indiana, is a financial services organization based in Carmel, Indiana. Conseco's insurance subsidiaries provide life insurance, annuity and supplemental health insurance products to more than 4 million customers in the United States...
and Marconi also led to huge profits for the company’s hedge funds while Tepper “keeps the market on edge.”
In 2009, Tepper's hedge-fund firm earned about $7 billion by buying distressed financial stocks (including acquiring Bank of America
Bank of America
Bank of America Corporation, an American multinational banking and financial services corporation, is the second largest bank holding company in the United States by assets, and the fourth largest bank in the U.S. by market capitalization. The bank is headquartered in Charlotte, North Carolina...
common stock at $3 per share) in February and March of that year and profiting from recovery of those stocks,with $4 billion of these profits going to Tepper's personal wealth. In March 2010, the New York Times reported that Tepper's success made him the top-earning hedge fund manager in the world in 2009, and in 2010 he was ranked by Forbes
Forbes
Forbes is an American publishing and media company. Its flagship publication, the Forbes magazine, is published biweekly. Its primary competitors in the national business magazine category are Fortune, which is also published biweekly, and Business Week...
as the 258th richest person in the world.
Personal life
Tepper and his wife Marlene are the parents of three children. His personal interests include coaching his children’s baseball, softball and soccer teams. Tepper is a resident of Livingston, New JerseyLivingston, New Jersey
Livingston is a township in Essex County, New Jersey, United States. As of the United States 2000 Census, the township population was 29,366.Livingston was incorporated as a township by an Act of the New Jersey Legislature on February 5, 1813, from portions of Caldwell Township and Springfield...
. Tepper currently serves as a member of the Business Board of Advisors for the Tepper School of Business at Carnegie Mellon and serves on various boards and committees for charitable and community organizations in New York and New Jersey. On September 25, 2009, Tepper purchased a portion of the Pittsburgh Steelers
Pittsburgh Steelers
The Pittsburgh Steelers are a professional football team based in Pittsburgh, Pennsylvania. The team currently belongs to the North Division of the American Football Conference in the National Football League . Founded in , the Steelers are the oldest franchise in the AFC...
.
He is against teacher's unions.
Philanthropy
On March 19, 2003, Tepper announced that he would make a single donation of $55,000,000 to Carnegie Mellon University's business school (then called the Graduate School of Industrial Administration—GSIA). This donation was made after he had been encouraged by Kenneth Dunn, his former professor (who became dean of the school). Tepper accepted the suggestion but made the contribution a “naming gift” and suggested that the school's name be changed to the David A. Tepper School of BusinessTepper School of Business
The Tepper School of Business is a private business school located on Carnegie Mellon University’s campus in Pittsburgh, Pennsylvania, USA.The school consistently ranks highly among the top business schools in the U.S., as well as in a wide range of specializations, such as finance,...
.
Tepper also has made several large gifts to the University of Pittsburgh, including several endowed undergraduate scholarships and support of academic centers and university-run community outreach programs.
David A. Tepper and wife Marlene have pledged $3.4 million to Rutgers University - Mason Gross School of the Arts, the alma mater of his wife.
External links
- Named Investment Guru of 2010
- David Tepper Portfolio with stock Picks
- David Tepper's Appaloosa Stock Portfolio, updated quarterly
- Tepper school official website
- "David Tepper Hedge Fund Manager Appaloosa Management," aTrader, May 4, 2010
- "Investor David Tepper goes where others don't dare", Pittsburgh Tribune-ReviewPittsburgh Tribune-ReviewThe Pittsburgh Tribune-Review, also known as "the Trib," is the second largest daily newspaper serving metropolitan Pittsburgh, Pennsylvania, in the United States...
, December 22, 2009 - "Ready to be Rich," (September 26, 2010 profile in New York Magazine)
- "Fund Boss Made $7 Billion in the Panic", The Wall Street JournalThe Wall Street JournalThe Wall Street Journal is an American English-language international daily newspaper. It is published in New York City by Dow Jones & Company, a division of News Corporation, along with the Asian and European editions of the Journal....
, December 23, 2009