He doesn’t care for the high-frequency traders that are beginning to dominate the markets, but says they can be exploited. “If you are patient, those people will make big mistakes. That is why I work 20 hours a day, that is the reason I am up at 3 (o’clock) in the morning waiting for the London guys to come to work,” he says. “I call them the pinstripers. The pinstripers never stepped in a pile of hog manure in their lives. They make big mistakes, and if you are up working you can take advantage of them.”
Crouch grew up in the salad days of the industry and his longtime customers understand how he trades and trust him. “I am a little more aggressive than some people,” Crouch says. “When I get a move, I will push the envelope a little bit. I will have a drawdown that will be bigger than some people like, but the way I look at it, it is the end of the year that counts.”
That was apparent in 2011 when he suffered his worst drawdown, 70%, thanks largely to a volatile corn market. The drawdown was sandwiched between equally impressive up moves, and the program closed the year down less than 10%. TKC is up a gaudy 200% this year through August, thanks to his deep knowledge of ag markets.
“I personally drove [more than] 3,000 miles this summer on weekends looking at crops,” Crouch says. “It is one thing for me to call you in Springfield, Ill. and you tell me what you think. As a farmer it is something different for me to see with my own eyes. I don’t know how many rows of corn and beans I have been in this summer, but I saw what was happening early on and I was able to make a pretty good play out of the grain market.”
He also understood this year’s drought, which he says is the worst he has ever seen, and its impact on livestock. Because of it, he made a killing on long hog spreads.
Most of his trades are spreads. “I am a directional trader; I use spreads to minimize risk and soften the volatility,” he says.
He is not too old to learn lessons, and he doesn’t want to repeat the drawdown of 2011. “I have learned to not be quite as aggressive with the fund, but I like to add to winners and I am [very] quick to pull the trigger on a loser.”
Crouch says he has three great loves: “Farming, breeding great livestock and trading commodities.” All three of those passions worked together to help him earn huge profits this year.
And in a long career that he has enjoyed thoroughly, he is back to doing what he loves most. “I really am enjoying what I am doing. I love the challenge of the marketplace. I love matching my knowledge and wits with the market,” Crouch says. “All traders have had ups and downs in their careers; the main thing is always have money to come back and play tomorrow.”