Greats & Great Reads

George Soros & the Commodities

Corp. Gang
 Overview
 George Soros & Stanley Druckenmiller
 The Commodities Corp. Gang
 Martin Schwartz: The Champion Trader
 Ed Seykota & the Trading Tribe
 Michael Marcus
 Bruce Kovner
 Paul Tudor Jones II
George Soros
 Born: Aug. 12, 1930 in Hungary
 Manager of the Quantum Fund
 Open Society Institute
 Macro trader extraordinaire
 British Pound coup in 1992
 “It is not whether you are right or
wrong that's important, but how
much money you make when you're
right and how much you lose when
you're wrong”
 Stanley Druckenmiller
 Former right hand
man of George Soros
 142 on the Forbes list
 “It takes courage to
be a pig.”
 “Just keep hitting
homeruns &
preserving capital”
The Alchemy of Finance
 By George Soros
 Macroeconomic
analysis bible
 Market Wizards”
 Also, the “New Market
Wizards” and “Stock
Market Wizards”
 By Jack Schwager
 Interviews with Top
Traders
 Commodities Corp.
 Founded in 1969 by Amos Hostetter
 “They are free to trade any way they want,
and to come and go as they please.”
 “Any theory is good as long as it makes
money”
 “Never bucked a trend in prices”
 "Never mind the cheese….let me out of
the trap."
And these are their stories…..
 Marty Schwartz:
The Champion Trader
 $40, 000 to $20M with never more
than 3% drawdown.
 “Not to go against the moving
averages, it’s self-destructive”
 “Know the amount you are willing
to lose”
 “Don’t break the rules”
“The most important thing is
money management,
money management,
money management.”
 “Let your gains run”
Pit Bull
 Pit Bull: Lessons from
Wall Street’s
Champion Day Trader
 By Marty Schwartz
 With actual trading
tips and lessons~!!
Ed Seykota & the Trading Tribe
 250 000% return in 16
years (‘70s ~ ‘80s)
 79% annualized –
60% after fees (‘90s)
 “Everybody gets what
they want out of the
market”
 Trend follower
 Math & Psychology
 www.seykota.com
 The Trading Tribe
 www.seykota.com
 “To avoid whipsaw losses, stop trading”
 “It can be very expensive to try to convince
the markets you are right.”
 The Toronto Tribe: Jason Russell
jason@hedgehogcapital.com
 But now, to a book, then his best
student….
 Trend Following
 Trend Following: How Great
Traders Make Millions in Up
or Down Markets
 By Michael Covel
 Endorsed by Ed Seykota

 How to become the owner of the Redsox~!!

 Commodities Corp.
Michael Marcus
 John Hopkins grad, at the top of his class.
 Student of Ed Seykota
 Formerly the largest futures trader in the US
 “Cutting down the number of trades you make”
 “The best trades are the ones in which you have
all 3 things going for you”
 Fundamentals
 Technicals
 Market Tone
 Bruce Kovner
 106 on the Forbes list
 Harvard Poli Sci. Prof.
 “Place my stop..that is
too far or too difficult to
reach easily”
 “If you personalize your
losses, you can’t trade.

 “The price for a market on any given day is the

correct price, then I try to figure out what
changes are occurring that will alter that price.”
 John Murphy
 Former head of research
at Merrill Lynch
 “Technical Analysis of the
Financial Markets”
 “Intermarket Analysis”
 Bond to currency to
commodities to stock.
 Paul Tudor Jones
 “Don’t be a hero. Don’t
have an ego.”
 “Don’t EVER average
losers”
 “Decrease your trading
volume when you are
trading poorly”
 “Always thinking about
 Left Comm. Corp. at 1980 losing money as opposed
 5 straight years of 100%+ to making money.”
 Never had a down year .
 30% annually
 What the Wizards Read…
 Reminiscence of a Stock
Operator
 By Edwin Lefvre
 The story of Jesse Livermore
 Frank discussion of his
investment methods
 Author followed Livermore
around for 3 years
 So who is Livermore…
 Greatest investor in the early
20th century
 “The Great Bear of Wall
Street”
 Netted $100 million at the day
of the 1929 crash.
 Summary
 Don’t predict the future
 But do react quickly
 Cut your losses
 Only make the good trades
Any Questions ~ ???