Paul Tudor Jones
|Paul Tudor Jones|
September 28, 1954 |
Memphis, Tennessee, U.S.
|Residence||Greenwich, Connecticut, United States|
|Alma mater||University of Virginia|
|Occupation||Hedge fund manager|
|Net worth||US$4.7 billion (September 2015)|
Paul Tudor Jones II (born September 28, 1954) is an American businessman who founded Tudor Investment Corporation, a private asset management company and hedge fund. As of March 2014, he was estimated to have a net worth of US$4.3 billion by Forbes Magazine and ranked as the 108th richest American and 345th richest in the world.
He founded the Robin Hood Foundation in 1988, which focuses on poverty reduction.
Beginnings and professional life
Jones was born in Memphis, Tennessee. He graduated from Presbyterian Day School, an all-boys elementary school, before attending Memphis University School for high school. Jones then went on to the University of Virginia, earning an undergraduate degree in economics in 1976 as well as welterweight boxing championship.
In 1976, he started working on the trading floors as a clerk and then became a broker for E. F. Hutton & Co. In 1980, he went strictly on his own for two and a half profitable years, before he "really got bored". He then applied to Harvard Business School, was accepted, and packed to go when the idea occurred to him that: "this is crazy, because for what I'm doing here, they're not going to teach me anything. This skill set is not something that they teach in business school."
William Dunavant, Jr., Jones' cousin and CEO of Dunavant Enterprises, one of the world's largest cotton merchants, introduced Jones to commodity broker Eli Tullis. Tullis hired Jones and mentored him in trading cotton futures at the New York Stock Exchange. Jones later said of Tullis:
He was the toughest son of a bitch I ever knew. He taught me that trading is very competitive and you have to be able to handle getting your butt kicked. No matter how you cut it, there are enormous emotional ups and downs involved.
In 1980, Jones founded Tudor Investment Corporation, an asset management firm headquartered in Greenwich, Connecticut. The Tudor Group, consisting of Tudor Investment Corporation and its affiliates, is involved in active trading, investing, and research in assets across fixed income, currencies, equities, and commodities asset classes and related derivative and other instruments in the global markets for an international clientele. The investment strategies of the Tudor Group include, among others, discretionary global macro, quantitative global macro (managed futures), discretionary equity long/short, quantitative equity market neutral and growth equity.
Peter Borish was second-in-command to Jones at Tudor Investment Corporation. Jones said Borish anticipated the crash in 1987 because Borish had mapped the 1987 market against the market preceding the 1929 crash, and noted the similarity between the two markets.
Jones previously served as a director of the Futures Industry Association and was instrumental in the creation and development of an education-arm for the association—the then Futures Industry Institute, a research institute later renamed the Institute for Financial Markets based in Washington D.C. Mr. Jones was also an advocate for the design and implementation of the first ethics training course that became the standard for exchange membership on all futures exchanges in the United States.
In February 2013, Forbes Magazine listed him as one of the 40 Highest-Earning hedge fund managers. Although the hedge fund industry standard is two percent per annum of assets under management and twenty percent of the profits, Tudor Investment Corp. charges four percent per annum of assets under management and twenty-three percent of the profits.
TRADER: The Documentary (1987)
The film shows Jones as a young man predicting the 1987 crash, using methods similar to market forecaster Robert Prechter. Although the video was shown on public television in November 1987, few copies exist. On the Internet, bids for the video start at $295. According to Michael Glyn, the video's director, Jones requested in the 1990s that the documentary be removed from circulation. The video has surfaced from time to time on different video sharing and torrent sites, but has often been taken down shortly thereafter due to copyright claims.
Jones' firm currently manages $17.7 billion (as of June 1, 2007). Their investment capabilities are broad and diverse, including global macro trading, fundamental equity investing in the U.S. and Europe, emerging markets, venture capital, commodities, event-driven strategies, and technical trading systems. Jones, with his colleague Hunt Taylor, was instrumental in the creation of FINEX, the financial futures division of the New York Board of Trade, and in the development of the U.S. dollar index futures contract that trades there. He also served as chairman of the New York Cotton Exchange from August 1992 through June 1995.
Trading style and beliefs
- Contrarian attempt to buy and sell turning points. Keeps trying the single trade idea until he changes his mind, fundamentally. Otherwise, he keeps cutting his position size down. Then he trades the smallest amount when his trading is at its worst.
- Considers himself as a premier market opportunist. When he develops an idea, he pursues it from a very-low-risk standpoint until he has been proven wrong repeatedly, or until he changes his viewpoint.
- Swing trader, the best money is made at the market turns. Has missed a lot of meat in the middle, but catches a lot of tops and bottoms.
- Spends his day making himself happy and relaxed. Gets out of a losing position that is making him uncomfortable. Nothing’s better than a fresh start. Key is to play great defense, not great offense.
- Never average losers. Decreases his trading size when he is doing poorly, increase when he is trading well.
- He has mental stops. If it hits that number, he is out no matter what. He uses not only price stops, but time stops.
- Monitors the whole portfolio equity (risk) in real-time.
- He believes prices move first and fundamentals come second.
- He doesn’t care about mistakes made 3 seconds ago, but what he is going to do from the next moment on.
- Don't be a hero. Don't have an ego. Always question yourself and your ability. Don't ever feel that you are very good. The second you do, you are dead.
Jones' global macro trading style is based primarily on technical analysis, as opposed to value investing, with an emphasis momentum factors driving markets. In a 2000 interview, he suggested however he regretted not being more involved with venture investing in technology firms during the 1990s.
Jones is the founder of the Robin Hood Foundation, a philanthropic organization backed mainly by hedge fund operators. He founded and was the chairman of the board of the Excellence Charter School, the country's first all-boys charter school, located in the Bedford–Stuyvesant neighborhood of Brooklyn, New York. He founded and chaired the Bedford Stuyvesant I Have A Dream Foundation, which puts local students in colleges.
Previously in 1986, he adopted a sixth grade class at an underperforming public school by guaranteeing college scholarships to students that graduated from high school. His idea was this would be an incentive to students to engage in academics with his goal being that 90% of those students successfully complete high school. However, only 33% of the students in the class eventually graduated from high school. Jones believed he "vastly underestimated both the academic and social challenges facing [the students in the class he adopted]" and his program was "completely ill-equipped to [help them] in an efficient fashion." In a 2009 speech, Jones stated he viewed this endeavor as a major failure on his part and a motivation to provide more comprehensive programs for assisting students from disadvantaged backgrounds in future efforts.
He owns Grumeti Reserves in Tanzania’s Western Serengeti and was recently lauded by the African Great Lakes country's Parliament for not permitting hunting in his reserve. The flagship hotel there, Sasaskwa, was named the #1 hotel in the world by Travel & Leisure Magazine in 2011 and 2012. Jones has been working with Tanzania and Paul Milton of Hart Howerton, a London architectural firm that specializes in large-scale land use, to develop regional plans for the sustainability of the area, its wildlife and its local communities. He has set up a trust for Pamushana a private reserve, operated by South Africa's Singita group, the reserve is about 300 Miles southeast of Harare, near the Mozambique border in Zimbabwe.
Jones has made large donations to his alma mater, the University of Virginia, including a $35 million donation, which went to the construction of a new basketball arena, named the John Paul Jones Arena, in honor of his father, an attorney who also attended the University of Virginia. In April 2012, UVA announced the creation of a new Contemplative Sciences Center through a $12 million gift from Jones and his wife, Sonia.
In June 2012, he was reportedly a key figure in the controversial ousting of University of Virginia President Teresa A. Sullivan. He penned an editorial supporting her resignation. On June 26, 2012, The University of Virginia Board of Visitors unanimously voted to reinstate Sullivan.
In April 2013, Jones was involved in another controversy at the University of Virginia after telling an audience of students and alumni, "As soon as that baby's lips touch that girl's bosom, forget it. Every single investment I did, every desire to understand what's going to make this go up or down is going to be overwhelmed by the most beautiful experience which a man will never share, an emotive connection between that mother and that baby. I've just seen it happen over and over again."
Jones moderated the education panel at the 2014 Forbes 400 Philanthropy Summit, which brought prominent labor leaders and reformers in education—U.S. Secretary of Education Arne Duncan, New York Governor Andrew Cuomo, American Federation of Teachers President Randi Weingarten, and Washington, D.C. Schools Chancellor Kaya Henderson—together for a discussion on five ideas to improve schools in the United States and add as much as $225 trillion to U.S. GDP over the next 80 years. Excerpts from the panel were featured in Forbes Magazine's December 2014 Philanthropy issue.
A political independent, Jones has donated money to numerous Democratic and Republican candidates. In 2012 he donated $200,000 to Mitt Romney. During the 2008 presidential election, Jones hosted a 500-person fundraiser at his Greenwich home for then-candidate Barack Obama. Jones also donated to John McCain and Rudy Giuliani's presidential campaigns.
- Munk, Nina. "Greenwich's Outrageous Fortune". Vanity Fair. Retrieved 2013-12-01.
- "Paul Tudor Jones, II.". Forbes. 2012-04-18. Retrieved 2013-12-01.
- Helhoski, Anna. "Billionaire's Daughter Posts Holiday Display Video". The Norwalk Daily Voice. Retrieved 19 July 2012.
- "Paul Tudor Jones". The Wall Street 100. www.streetstories.com. 1990-07-10. Retrieved 2007-11-17.
- "Paul Tudor Jones Interview | Original Turtle Trading Rules and Stories from TurtleTrader® and Michael Covel". Turtletrader.com. 1944-05-31. Retrieved 2013-12-01.
- "Paul Tudor Jones Insights | The Trend Following Blog of Author Michael Covel". Michaelcovel.com. 2006-08-03. Retrieved 2013-12-01.
- Weizel, Richard. "Eight County Billionaires Make Forbes Richest List". The Norwalk Daily Voice. Retrieved 13 July 2012.
- Nielson, Samantha. "Why did Tudor Investment buy Apple?". Market Realist. Retrieved 16 December 2015.
- "#382 Paul Jones II". The World's Richest People (Forbes.com). 2006-03-08. Retrieved 2007-04-16.
- Covel, Michael W. (March 25, 2009). "Follow the Trend | Trend Following: Learn to Make Millions in Up or Down Markets". FT Press. Retrieved February 6, 2016.
- Sebastian Mallaby (2010). More Money Than God: Hedge Funds and the Making of a New Elite. Penguin. Retrieved February 6, 2016.
- "Paul Tudor Jones". Futuresindustry.org. Retrieved 2013-12-01.
- Roose, Kevin (2014). Young Money: Inside the Hidden World of Wall Street's Post-Crash Recruits. London, UK: John Murray (Publishers), An Hachette UK Company. p. 206. ISBN 978-1-47361-161-0.
- Vardi, Nathan (Feb 26, 2013), "The 40 Highest-Earning Hedge Fund Managers & Traders 2013", Forbes
- Buhl, Teri (2010-09-22). "Paul Tudor Jones is Not Making Investors Any Money". Forbes.
- Thomas, Jr., Landon (2007-10-13). "The Man Who Won as Others Lost". New York Times. Retrieved 2007-11-17.
- "Paul Tudor Jones II". Robin Hood Foundation. Retrieved February 10, 2015.
- "Paul Jones II". Paul Tudor Jones. moneymastersdirect.com. 2006-03-08. Retrieved 2007-11-17.
- "A Dozen Things I've Learned from Paul Tudor Jones About Investing and Trading". 25iq. Retrieved 2015-12-31.
- "Paul Tudor Jones II Interview". chinese-school.netfirms.com. Retrieved 2015-12-31.
- "Paul Tudor Jones". Octafinance. Retrieved 15 December 2015.
- "Paul Tudor Jones – Failure Speech June 2009". Scribd. Retrieved 2015-12-31.
- "Can Hedge Fund Billionaire Paul Tudor Jones Save America's Public Education System?". Forbes. Retrieved 2015-12-31.
- "World's Best Hotels 2013 – Articles | Travel + Leisure". Travelandleisure.com. 2013-11-21. Retrieved 2013-12-01.
- Moltz, David. "John Paul Jones Arena". The Cavalier Daily.
- "U.Va. To Launch Contemplative Sciences Center | UVA Today". News.virginia.edu. 2012-04-10. Retrieved 2013-12-01.
- Melby, Caleb. "Charlottesville Paper Reports That Billionaire Paul Tudor Jones Was Involved In UVA President Ouster". Forbes. Retrieved 2013-12-01.
- "OP-ED: Aspiring to achieve greatness – The Daily Progress: News". The Daily Progress. 2012-06-17. Retrieved 2013-12-01.
- "UVA Board of Visitors Vote to Reinstate Sullivan – WSET.com – ABC13". WSET.com. Retrieved 2013-12-01.
- Johnson, Jenna (2013-05-24). "Paul Tudor Jones: In macro trading, babies are a ‘killer’ to a woman’s focus". The Washington Post. Retrieved 23 May 2013.
- "Billionaire Paul Tudor Jones Says He Subtracts 10–20 Percent from Managers Going Through Divorce". Fatherhood Channel. Retrieved 2 June 2013.
- "Reinventing American Public Education". Forbes Magazine. 2014-12-01. Retrieved 2014-12-01.
- "Here's a Plan to Turn Around U.S. Education—and Generate $225 Trillion". Forbes. 2014-12-01. Retrieved 2014-12-01.
- "The corruption of yoga". Dailylife.com.au. 2012-07-24. Retrieved 2013-12-01.
- McLean, Bethany. "Yoga-for-Trophy-Wives Fitness Fad That’s Alienating Discipline Devotees". Vanity Fair. Retrieved 2013-12-01.
-  Archived March 6, 2013 at the Wayback Machine
- "Why The Wife Of Hedge Funder Paul Tudor Jones Is Infuriating A Group Of Yogis". Business Insider. 2012-03-06. Retrieved 2013-12-01.
- "Scene 2011: Dimon, Mack, Krawcheck, Paulson, Paltrow, Bundchen: New York City Ballet spring gala". Bloomberg. 2011-12-29. Retrieved 2013-12-01.
- "Paul Tudor Jones and Tudor Investment Article at". Streetstories.com. Retrieved 2013-12-01.
- Financial World, The Wall Street 100, By Stephen Taub, David Carey, Amy Barrett, Richard J. Coletti and Jackie Gold, July 10, 1990, pg. 56 
- "Obama-Romney matchup pits husband vs. wife". Politico.Com. 2012-06-14. Retrieved 2013-12-01.
- "Big Rudy Guy and Allan Houston to Raise Money for Obama". The New York Observer. 2007-04-23. Retrieved 2014-06-12.
- "Hedge Fund Moguls Back Giuliani’s Presidential Fund". The New York Times. 2007-02-01. Retrieved 2013-12-01.
- "60 Minutes: Modern-day Robin Hood applies business skills to philanthropy" May 5, 2013
- Curated Interview With Paul Tudor Jones From Market Wizards
- Key Quotes From Paul Tudor Jones in TRADER: The Documentary
- Absolute Return + Alpha, June 2008 interview
- "Adapt or Die," Hedge Fund Review, July 2004
- "Failure Speech", June 2009
- "Price Limits: A Return to Patience and Rationality in U.S. Markets", October 2010
- "Paul Tudor Jones speech during painting unveiling ceremony at UVA's John Paul Jones Arena", January 7, 2011
- "Paul Tudor Jones speech on giving at Robin Hood Heroes Award Breakfast", November 10, 2011
- "Paul Tudor Jones comments on the lack of female traders", May 23, 2013
- "Can Hedge Fund Billionaire Paul Tudor Jones Save America's Public Education System?", Forbes, December 2, 2013
- "Paul Tudor Jones and Deepak Chopra", December 10, 2013
- Paul Tudor Jones II at TED