A Fund vs. Your Own Money

Discussion in 'Professional Trading' started by Opulence, Oct 16, 2012.

  1. Believe it or not, there are edges that we, as retail, simply can not access regardless of the rhetoric on this site- these are real edges that only can be accessed via funds. surf
     
    #11     Oct 22, 2012
  2. heech

    heech

    Neither of those two reasons apply to me.

    Like I said earlier, I started a fund for two reasons:

    1) to make more money (without increasing downside risk),
    2) because I like building businesses.
     
    #12     Oct 22, 2012
  3. The problem is, you can't. Markets change, edges change, they are not static regardless of what you read or folks claims. surf
     
    #13     Oct 22, 2012
  4. I think that's really the thing

    Are you a people person?

    I know I'm not, the best day of my life was when I stopped being a broker and started trading my own account

    I still manage some OPM for friends and family, but they don't know what the hell is going on, and there is very little trading involved, it is all just asset management (I don't even charge them a fee anymore.)

    they will never have to answer for the kind of risk I take everyday
     
    #14     Oct 22, 2012
  5. Surely you mean, YOU will never have to answer, not THEY--as in your clients--right?
     
    #15     Oct 22, 2012
  6. I answer for it everyday, but I don't have to explain it to anybody

    It seemed like a good idea at the time

    you get joy out of setting up operations and getting people on board

    that's the difference between you and me

    if I need any kind of human contact, I can just post bullshit on ET

    that is why I am happy in just a small town, and you need to be in the big city

    different strokes for different folks

    to each his own

    you know what makes you happy

    and I like being a hermit

    you could probably live without me, but I can't live without you

    nothing happens until somebody can sell it
     
    #16     Oct 22, 2012
  7. well said, oldtime. i couldnt make it if there wasn't edge and new ideas to present like those from folks like you----- surf
     
    #17     Oct 22, 2012
  8. I should just give my money to you. At the moment my edge is getting a little dull.
     
    #18     Oct 22, 2012
  9. Sure, if you have the wherewithal to invest in hedge funds, I would be pleased to share what I have in my stable. Right now, a start up medical fund and a quant arb program operated by several top notch credentialed science types are seeking allocation. surf
     
    #19     Oct 22, 2012
  10. Smoker

    Smoker

    Hi Opulence,

    Just for a different perspective I am kind of in the middle between these two but historically am more slanted to the professional side verses retail side.

    I have worked at a big bank FX market making, on the CME floor options market making for a proprietary floor trading firm, a hedge fund in London and finally as an internal proprietary trader for a large asset allocator offshore in the Middle East.

    So more hired gun than hedge fund owner/manager but always running a capital allocator verses just my own money.

    Institutional money means you can leverage your talent via a nice fat free call option.

    Well this is kind of strange because I can’t think of a universal reason that anyone wouldn’t want to leverage their talent and choose a pretty close to sure shot and relatively quick way to becoming a millionaire with minimal personal financial exposure.


    There might be some specific reasons to a particular individual but since I started trading in 1982 to present day I have never personally met an individual that turned down the free call.

    In fact in all market stories/myths/legends I have only heard of (not met) one guy that choose to turn down institutional money and continue to only trade his own money.

    The siren call of the free call option on your trading performance is simply too strong.





    I’ve never met this guy either who decided to take institutional money for a few years just to quickly become independently wealthy so they could then shut down the fund to just trade their own money.

    It is amazing how poor a millionaire feels when his peer group is all multimillionaires so most stay at it for as long as their performance holds out.

    I think ego is just part of a pretty long laundry list and not that close to the top.

    For most I think it is the pretty high odds of success in achieving financial independence in a pretty sweet time frame that is the driving force for most. I am from a working class background and the money was a big part of it for me.

    The intellectual challenge of figuring out a big complex puzzle is a pretty powerful drug when it hooks you.

    But the big reason is trading attracts people that are very competitive by nature and they really want to experience the satisfaction of trading at the highest level.

    Trading serious size at an institution is like playing on the GPA tour or NBA etc and for most very competitive people doesn’t compare to hustling at the local golf course or neighborhood basketball court.


    The edge in the institutional experience to me was like being taught to play baseball in little league, then high school, collage, minors and finally making the jump to the big leagues with the coaching, experience etc one gains along the way.

    I just think the above route is a lot easier than being self taught and then trying to make it as a pro while trading out of your house.

    I have a healthy ego but don’t think I ever could have made it without the institutional training, experience, mentors etc.

    I really don’t know anyone that has ever done this and the closest I can think of is someone like Linda Bradford Raschke who today (but not in the past) trading (mostly I think) her own cash out of her house.

    But Linda Bradford Raschke isn’t even a very good example since she had several years experience with mentors, getting staked etc on the San Francisco and Philadelphia exchange floors.

    When I was doing FX options for CRT in Phili for a short period of time in the 1980s she was on the Phili floor at the same time but doing equity. Without that experience and the backing, training etc it would be a pretty big jump to being a multimillionaire trading out of your house in Florida and on the weekend riding your very expensive horses to chill out.

    Just my two dirhams worth.


    You really like to tempt the trading gods don’t you!

    What happens it you lose all their cash? Then they will have to answer in their financial lives for the risk you did take but unfortunately didn’t work out.

    For the last twenty years or so on a fairly regular basis I get asked to manage a few bucks for family, friends and the guys at my Dad’s barbecue etc. I am polite but firm; no freaking way!

    I am glad I made it with institutional money because I don’t need the kind of pressure you must be under trading Mom’s retirement fund.

    Best of luck!

    Cheers, Smoker
     
    #20     Oct 24, 2012
    ras72 likes this.