Paul Tudor Jones

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Paul Tudor Jones

 

Hedge fund manager Paul Tudor Jones is the founder, Chairman, and CEO of the Tudor Group, under which is Tudor Investment Corporation, a well-known, very successful asset management firm. Jones is famous for his worldwide macro trades, which particularly focus on commodities and currencies. He is also known and appreciated for his perspective on and involvement in philanthropic and conservation efforts.

 

Earning His Stripes

 

Paul Tudor Jones was born in Memphis, where he also grew up and went to primary and secondary school before attending the University of Virginia, where he got a degree in economics.

 

After graduating, Jones went to work at brokerage firm E.F. Hutton as a floor clerk. He made enough of an impression that he became a stockbroker. After a couple of years, Jones applied to, and was accepted by, Harvard Business School. However, before he ever left for Boston, he reconsidered his plan and never went because he didn’t think Harvard would teach him more than what he was already learning and doing.

 

Soon after, his cousin William Dunavant, Jr., introduced Paul to legendary trader Eli Tullis. Jones went to work for Tullis and learned the ins and outs of being a trader by trading cotton futures on the New York Stock Exchange. Jones credits Tullis not only for mentoring him but also for teaching him the toughness needed to survive and thrive in a very competitive business. Under Tullis, Jones learned how to handle the occasional beating and rebound from it.

 

Jones Builds Tudor Investment Corporation

 

Paul Tudor Jones launched his famed hedge fund in 1980. Based in Connecticut, Tudor Investment put Jones’s varied trading strategies into researching, trading, and investing in commodities, currencies, equities, and other financial instruments. From the very start, it made money for its investors.

 

One of the earliest, most notable successes came in 1987 on Black Monday, when the firm noticed that patterns that had led to the 1929 crash were occurring again. As such, Jones predicted the crash by buying up millions of short positions and, when the dust cleared, Jones had tripled his investment.

 

Through the 1990s and 2000s, Tudor continued its phenomenal run, averaging nearly 20% in returns. Investments in technology and financial services have generally been the most productive parts of the portfolio. Jones’s stellar track record over the past three decades is among the most successful runs Wall Street has seen. You might recognize some of Tudor’s clients – Facebook, Time Warner Cable, and National Cash Register.

 

Jones’s Investing Strategies and Thoughts on Capitalism

 

Paul Tudor Jones has had incredible successes through the years, mostly by following certain beliefs and strategies that he’s developed and honed through the years, which include the following:

 

·                 Jump on opportunities with conviction

·                 Pursue low-risk chances until proven wrong or circumstances change

·                 As the market turns and flips, make your move

·                 When in an uncomfortable or losing position, get out (defense is the best offense)

·                 Formulate stops either by time or price and never waver – if the stop number is hit, get out

·                 Forget your mistakes and keep moving forward

·                 Keep humble in your dealings

·                 Make decisions without your ego

 

Jones enthuses about capitalism, appreciating the fact that it’s given him a life and fortune he never could have imagined. In his eyes, it’s been the catalyst for every major innovation the world has seen. But that it now is so hyper-focused on profits distresses him.

 

The economic divisions between people in countries all over the world is causing unrealized damage to society at large. He feels that the gap between the haves and have-nots will close, as it usually does, in one of three ways – revolution, war, or higher taxes. This is not something he relishes happening, so his idea is that a fourth option, fairness in corporate behavior, must become the dominant one.

 

In other words, his thoughts echo those of Adam Smith in that those who have increased profits and subsequent wealth must observe and foster corporate social responsibility better than they currently do. Otherwise, without this humanity, the outlook for society as a whole is bleak.

 

Philanthropy

 

In addition to his investing and management activities, and in line with his thoughts regarding corporate responsibility, Paul Tudor Jones is nearly as well known for his philanthropy. In 1988, Jones created the Robin Hood Foundation, a philanthropic venture that is backed by several hedge fund operators. The fund’s sole purpose is to end poverty in New York City. He’s also been active in his charity toward his alma mater, Virginia, and toward conservation efforts, including chairing The National Fish and Wildlife Foundation.

 

It seems Paul Tudor Jones is putting his considerable fortune where his mouth is in doing his part to be more socially responsible.

 

 

 


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Paul Tudor Jones

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