He rose to prominence at Deutsche Bank in the early and mid 2000s with his credit default swap and capital structure arbitrage trading strategies.
The trades in turn netted several hedge funds including Weinstein's hundreds of millions of dollars after they took an opposing position in the credit default swap market.
[8] Weinstein had an interest in investing from an early age and was a fan of the television program Wall Street Week, hosted by Louis Rukeyser, which his family watched every Friday night.
As a junior at the Stuyvesant High School in New York City, he was a winner of a stock-picking contest sponsored by Newsday, beating out a field of about 5000 students.
In 1997, he joined Donaldson, Lufkin & Jenrette,[4][6] to which he was recruited by his early mentor Delucia who had transferred from Goldman Sachs.
Deutsche Bank was interested in expanding its operations in the CDS market having just acquired Bankers Trust, the firm that created credit default swaps in the early 1990s.
[9][16] Known as capital structure arbitrage, this is one of Weinstein's main strategies to take advantage of discrepancies in the prices of the several types of securities available for trade on the same company.
[17] The GM trade for a period appeared to go wrong when the company's stock unexpectedly rose while the CDS plummeted, indicating a loss on both sides.
[20] In April 2009, Weinstein hired 15 members of his former team to form Saba Capital Management, a credit-focused hedge fund based out of the Chrysler Building in Manhattan.
[22][23] He had left Deutsche Bank two months before,[24] and his former employer had agreed to the move years in advance and to become one of Saba's main brokers.
[2] [29] The trader, Bruno Iksil, was selling billions of dollars worth of notes for the Investment Grade Series 9 10-year Index CDS.
In February 2012, Weinstein recommended to a conference of hedge fund managers that they should also keep buying as the seller was continuing to sell.
He had become interested in blackjack since the early 1990s and learned card counting after reading Edward O. Thorp's Beat the Dealer.