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during the civil war years, hoping to survive. He was an Austro-Hungarian prisoner in World War I. Whatever he had to do to survive, he did, no matter how unpleasant. Survival became a noble virtue in George Soros's life.26

Soros's father made arrangements for the family to get false identity papers, and he found places for them to live or to hide.27 In his book Soros, Robert Slater details how George recalls his father paying for false identity papers so that he could pose as Janus Kis, the godson of an official of the Hungarian Agricultural Ministry responsible for confiscating Jewish properties. Soros described this as a commercial transaction. Tivadar taught George valuable lessons about the art of survival: It is all right to take risks; when taking risks, don't bet the ranch. The war taught Soros another lesson—a gap exists between perception and reality. And just as Tivadar had, George would learn that frequently it was best to search for unconventional methods to solve problems.28

Soros suggests that operating a hedge fund tested his training in survival to the maximum. "Using leverage can produce superior results when the going is good, but can wipe you out when events fail to conform to your expectations. One of the hardest things to judge is what level of risk is safe. There are no universally valid yardsticks. Each situation needs to be judged on its own merits. In the final analysis, you must rely on your instincts for survival."29

Changing Investment Character

In Soros on Soros: Staying Ahead of the Curve, a book that he wrote in 1995, Soros describes his lack of investment style. "I try to change my style to fit the conditions. If you look at the history of the [Quantum] funds, it has changed its character many times. For the first ten years, it used practically no macro instruments. Afterwards, macro investing became the dominant theme. But more recently we started investing in industrial assets. . . . I do not play according to a given set of rules. I look for changes in the rules of the game."30

Soros identified the big themes that drove the market. Druckenmiller and the analysts did the stock picking. Soros's philosophy, strategy, and tactics set the mood.31 Specialist funds existed, but the chief investment officer could borrow the best ideas from each and use them in the Quantum Fund.