Once on a flight from Chicago to San Francisco, I (miraculously) was upgraded to business class and was seated next to a very tall man who was on the phone from the time we entered the plane to take-off. Overhearing the conversation, I picked up some “puts” and “calls” recommendations, which obviously piqued my interest. When we were in the air, I asked him if he was an options trader. He said he used options only to protect his portfolio, which he managed for a large East Coast firm.
As we spoke, he said he had gone to the University of Illinois, where he had played football. It turned out he was the quarterback and a stand out until sustaining a debilitating injury. He said during those dark days when he was reevaluating his life goals, he had a real gut check. He eventually went on to become a doctor and then an asset manager, where he focused on health/medical stock funds.
Although Illinois friends were excited I met one of their former football stars, I was most impressed with his ability to reinvent himself successfully. Moving from athlete to doctor to asset manager is quite a curvy path, but he seemed to do it easily.
I remembered this when reading our cover interview with Ben Davies (see “Ben Davies: Turning adversity into gold,” by Associate Editor Michael McFarlin). Davies had been on deck to go to the Atlanta summer Olympics to play field hockey when he was sidetracked with a back injury, which basically ended that “career.” However, a chance meeting led to a stint at Man Financial, which was at that time a private commodity group. Eventually he came to work for one of the top primary dealers, Greenwich Capital, where he really cut his teeth both in trading and devising his worldview of free markets and the importance of hard assets.
Today Davies manages a multimillion dollar long-only gold fund for his firm, Hinde Capital. Granted, it’s been a tough year for gold, and yes, for Davies’ fund, but he says his fund has done better than gold. He also reminded us that the gold fund is only one part of a client’s overall portfolio.
Change is inevitable and often not easy. Moving from an old to new media platform has been long, tedious and sometimes exhilarating for us at Futures. However, seeing how the above traders/managers used their competitive skills and smarts to change is a testimony to being agile and opportunistic in markets and in careers.
One of the sea changes for the futures industry was its move off the floor into electronic trading. It was long in coming and then seemed to happen overnight. In early September, FuturesMag.com will host the web premier of the movie “Floored.” Originally released in theaters in late 2009, the director’s cut will be available for the first time on the Internet, and, for now, only at FuturesMag.com.
The documentary shows how the waning days of the floor affected many traders; some of them had made their money and left, while others planned to be the last man standing. It’s poignant, troubling and funny, but captures the trading industry and some of its players well and, of course, solidifies the incredible legend of the trading floor.
Director James Allen Smith, like many successful traders, also learned to adapt to his environment. He started off as a painter but became a web designer, which landed him a job with a former trader who ran an upstairs business. Smith then became a filmmaker, something that never was in his original game plan, when he saw how life on the floor was changing and how many traders weren’t adapting.
No doubt the skills of the floor are different than the skills needed upstairs. But perhaps only the best traders are able to adapt to adversity, both in life and in trading. That shouldn’t be surprising as volatility is the lifeblood of this business.