“The secret to being successful from a trading perspective is to have an indefatigable and an undying and unquenchable thirst for information and knowledge.”
Hedge Fund Manager Paul Tudor Jones – Net Gains (Since Inception) $13.5 billion
In the world of investment management many financial advisors or investment brokers ultimate goal would be to end up as a hedge fund manager. A hedge fund is an investment vehicle and business structure that brings capital from numerous investors and invests these resources into securities and other profitable investment instruments. The companies that run these hedge funds may be structured as limited partnerships or limited liability companies. The investments that a hedge fund manager would take are capped by leverage and are highly liquid. If a hedge fund manager wants to be successful for his company they need to have a sound investment strategy and a competitive edge within the industry. A good hedge fund manager will have many investors with a lot of capital to invest with them, and with a good marketing and risk management plan they will be very successful and make a lot of money.
Hedge Fund Manager Paul Tudor Jones was born September 28, 1954. He is an American investor, hedge fund manager as well as a renowned philanthropist. In 1980, he founded Tudor Investment Corporation which is an asset management firm headquartered in Greenwich, Connecticut. After this, he proceeded on creating the Tudor Group, a hedge fund holding company which mainly covers fixed income, currencies, equities, and other commodities. During the February 2017, Forbes Magazine determined his net worth to be $4.7 billion. This made him the 120th richest person on the Forbes 400 and the 19th highest earning hedge fund manager. Most people know him for his large-scale philanthropy. This can be well seen in his passion for forming and developing the Robin Hood Foundation which focuses on poverty reduction.
Like all of the truly great traders, Jones is laser-focused on risk control. The following 15 statements were taken from his chapter in Market Wizards.
- “The market is going to go where it is going to go”
- “Never play macho man with the market”
- “Never overtrade”
- “I am always thinking about losing money, as opposed to making money”
- “Risk control is the most important thing in trading”.
- “When I am trading poorly, I keep reducing my position size”.
- “Don’t ever average losers”
- “Decrease your trading volume when you are trading poorly”
- “Increase your volume when you are trading well”.
- “The most important rule of trading is to play great defense, not great offense”
- “Every day I assume every position I have is wrong
- “Don’t be a hero, don’t have an ego”
- “I always believe that prices move first and fundamentals move second”
- “I try to avoid any emotional attachment to a market”
- “Don’t focus on making money, focus on protecting what you have”