There are few traders who have experienced the highs and the lows of trading the way Victor Niederhoffer has. When he began, he turned $50,000 into $20 million over 18 months. George Soros spotted his talent, eventually making him a partner at Quantum Funds for fixed income and foreign exchange. Niederhoffer stayed with him for almost a decade, and when he launched a fund of his own, it was seeded by none other than Soros. Niederhoffer’s track record at both his own fund and Soros’s Quantum fund was more than 30 percent a year compounded for almost 20 years. This has been regarded as one of the best trading records of all time. But reward comes with risk, and Niederhoffer embraced risk in ways that would eventually become costly. He got caught leaning the wrong way when the Asian financial crisis hit in 1997, all but completely wiping his fund out. But he slowly rebuilt, and once again amassed another fortune, only to see this capital pool destroyed by the financial crisis of 2007-09. Niederhoffer is a brilliant and fascinating character, a study of rich contrasts. He is a nationally ranked squash champion, and former Berkeley professor of finance and statistics. He is an undeniably talented trader, except for that small issue of occasionally blowing up and getting wiped out. I am not sure that he fully accepts responsibility for his various disasters. His trading record is akin to setting the track record on the straightaways, only to crash into the wall on the curves. Still, he teaches an important lesson for any trader. As revealed in his first book, "The Education of a Speculator," the risk-embracing style that created his first fortune comes with some caveats.