vladimir efros and springtree

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Vlad Efros is a hustler. At 14, the then-recent Russian immigrant bought silver with his bar mitzvah money, selling it a year later after the price rose from $5 to $8. At 16, he opened a baseball card business in his adopted hometown of Binghamton, New York, selling it two years later at the end of high school. At 21, Efros managed a small record label and a rock band while taking time off from college. At 26, he sold his baseball card collection for $3,500 during the 1998 home run race that inflated values. He used the money to pay off his credit cards and open a TD Waterhouse online brokerage account and then spent the same year — his senior year at Binghamton University — trading stocks. Efros has been engrossed in the swings of financial markets ever since.

Efros, 39, is natural trader who sharpened his skills in a high-pressure, fast-paced buying-and-selling environment: the shared day-trading desks of Broadway Trading during the dot-com bubble. (David Glass, whose story inspired the movie Boiler Room, briefly worked at Broadway.) But Efros grew tired of the fast, technical trading, even though he had gotten good enough to run money for another Broadway trader, Landon Ray. A free thinker, he wanted to capitalize on macro trends. “I always had a good sense of the big picture before others,” he says. That combination of thematic thinking and day-trading has made Abundance highly successful.

Abundance was a one-man operation until 2007, when Efros hired an assistant. Wanting to raise more capital, he hired a full-time two-person team early last year to market and institutionalize the fund. Efros believes Abundance could grow from $30 million to as much as $250 million without any problems because it trades mostly liquid equities, ETFs and options, and the occasional currency hedge. He doesn’t, however, want to court lots of money through institutional investors and become less nimble. “In these markets, I want to be a speedboat and not an oil tanker,” he says. Investors — most of them wealthy individuals — praise Efros’s trading prowess and say he stays well within agreed-upon position and loss limits even if he trades so frequently. One investor is a former senior official at the Securities and Exchange Commission.

Efros usually has between 15 and 40 positions at once around a few macro themes, which have ranged from being long carbon fiber (2006) and technology (late 2010) to short commercial real estate investment trusts (2008) and restaurants (2007 to 2008). He can trade dozens of times a day, adjusting positions, or wait several days before moving, especially in calmer markets. But above all, he likes to stay flexible. “Regardless of whether my underlying view is correct, I have to respect what the market is doing and adjust,” says Efros.

In 2008, Efros says, he profited by predicting the crash of the real estate market, which he had foreseen as early as late 2004. He also profited from shorting investment banks and advertisers as the economy deteriorated. In 2009, Efros gained just 2.31 percent even though the equity markets raced higher. He took profits and started making contrarian bets too soon, expecting a market correction. In 2010, Efros says, he experienced a first-half “roller coaster,” losing 6.82 percent in March and 11.21 percent in April, and gaining 13.30 percent in January and 13.10 percent in June, before a less volatile and positive second half of the year.

Looking ahead, Efros says he believes another downturn is coming. On the long side, he likes select technology and health care stocks and gold miners, although not in the short term. Abundance is rebuilding its portfolio of shorts but still predicts the deterioration of construction activity in China and the eventual default of Greece.