Successful Traders - Paul Tudor Jones II

Top Traders - Paul Tudor Jones

Paul Tudor Jones II was born on September 28, 1954, and is an American billionaire, hedge fund manager, conservationist, and philanthropist. In 1980 he created his investment fund - Tudor Investment Corporation, an asset management firm headquartered in Stamford, Connecticut. Eight years later he founded Robin Hood Foundation, which focuses on reducing poverty.

Jones graduated from Presbyterian Day School, then the university school in Memphis. Jones continued at the University of Virginia, where he was a welterweight boxing champion (67 kg).

In 1976, he earned a bachelor's degree in economics from the University of Virginia. In the 1980s, Jones was accepted to Harvard Business School, but did not continue his studies!

In 1976, after graduating from the University of Virginia, Jones asked his cousin William Dunavant Jr. for an introduction to trading. Dunavant was CEO of Dunavant Enterprises and one of the largest cotton merchants in the world. Dunavant sent Jones to speak with Eli Tullis's broker in New Orleans. Tullis hired Jones and mentored him in cotton futures trading at the New York Cotton Exchange. Later, Eli Tullis fired Jones when he fell asleep at his desk after a night of partying in New Orleans. Many years later, Jones served as treasurer (in 1986) and then as chairman of the New York Cotton Exchange, from August 1992 to June 1995.

In 1980, Jones founded Tudor Investment Corporation, an asset management firm headquartered in Stamford, Connecticut. Dunavant and Tullis were among Tudor's first clients. 

Tudor Jones used his experience in cotton trading to branch out into other commodities and financial instruments, such as stock index contracts and currency futures contracts.

One of Jones's earliest and most important successes was predicting Black Monday in 1987, tripling his money during the event thanks to large short positions (selling). 

Jones's firm manages 7.8 billion dollars (as of June 30, 2019). Their investment capabilities are broad and diverse, including global macro trading, fundamental equity investing in the US and Europe, emerging markets, venture capital, commodities, event-driven strategies, and technical trading systems.

The Tudor Group, made up of Tudor Investment Corporation and its subsidiaries, is involved in active trading, investment, and research across currencies, equities, commodities, and related derivative instruments.

Paul Tudor Jones's Investment Psychology.

As reported in Market Wizards and the press, Jones's futures trading style and beliefs are as follows: 

-He sees himself as a market opportunist. When he develops an idea, he follows it from a very low-risk point of view until it has repeatedly proven wrong or until he changes his view.

-Swing trader. He has missed many good market situations, but he has also caught many tops and bottoms.

-He spends the day happy and relaxed. He exits a losing position that makes him feel uncomfortable. Nothing is better than a fresh start. The key is to play great defense, not great offense.

-He never averages losers. He lowers his trading size when he is doing poorly and increases it when he is trading well.

-He monitors the entire capital portfolio (risk) in real time.

-He believes price action comes first, and fundamental analysis comes second.

-He does not care about mistakes made three seconds ago, but about what he will do from the next moment onward.

-Do not be a hero. Have no ego. Always question yourself and your ability. Never feel that you are very good. Make the mistake twice and you are dead.

Jones's global macro trading style is based primarily on technical analysis, unlike value investing, with an emphasis on momentum factors that drive markets. In a 2000 interview, he suggested that, nevertheless, he regrets not being more involved in investing in technology companies in the 90s. Jones also stated in 2020 that he holds bitcoin as a hedge against inflation. 

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Risk warning: This article is for information and education only, reflects the situation as of its publication date and does not constitute investment advice, an offer or a recommendation to buy or sell any financial instrument. Trading leveraged instruments (Forex, CFDs) and crypto-assets carries a high risk of losing your capital. Past performance does not guarantee future results. Before investing, assess your objectives and risk tolerance and, if needed, consult a licensed adviser. Details: Disclaimer & Risk Warning.