he has made money off his hypothesis in '87 and most recently in purchasing underpriced tail hedges. the most recent fund he advised was underwater for many years before scoring a total 230% return over life-of-portfolio from the action in march '20. he never claimed to predict events that are surprising; he only claimed that the pricing of the bets for 3+ sigma events was wrong, and he has monetized this a few times in his career.
as a practical matter, it is hard to be a billionaire making such bets. the time decay of derivatives positions is working strongly against you and you have to structure your position very efficiently. you are not likely to have any LPs who are willing to take such huge drawdowns in the down periods right up until the blowup. so it is possible to make millions off such bets as his but not billions owing to the nature of option Greeks and the psychology of your typical LP.
as a practical matter, it is hard to be a billionaire making such bets. the time decay of derivatives positions is working strongly against you and you have to structure your position very efficiently. you are not likely to have any LPs who are willing to take such huge drawdowns in the down periods right up until the blowup. so it is possible to make millions off such bets as his but not billions owing to the nature of option Greeks and the psychology of your typical LP.