How Paul Tudor Jones' love for beer and games got him into trading
Legendary macro hedge fund manager Paul Tudor Jones got into exhibited the traits of a trader at a very young age.
“I got to be a trader probably because when I was really, really young I was a game fanatic. I played every single game that there was — Monopoly, Life, Parcheesi, poker. I used to play hours of solitaire. I just loved playing games,” Jones told Goldman Sachs CEO Lloyd Blankfein in a wide-ranging discussion as part of the bank’s “Talks at GS” series.
While in college at the University of Virginia, he picked up chess and backgammon. He was also the bookie in his fraternity, Sigma Alpha Epsilon.
“By the time I graduated from college, I already had probably at least a masters in probabilistic theory,” he said.
While in college, Jones said he had no idea what he wanted to do “other than drink beer.”
“I was extraordinarily good at,” he joked.
During the final semester of his senior year, Robert E. Lee Wilson V of Wilson, Arkansas introduced him to soybean futures, and while hedging their crop he learned that it made “football gambling just pale in comparison.”
Soon after, Jones found as a college student he could relate to the profession.
“Literally that weekend, I read a story on a guy named Richard Dennis, who was the biggest local at the Board of Trade. And then he used to say that he did his best trading when he was hungover because there was no emotion. And I thought, hmm, this is starting to get close to what I’m culturally pretty good at,” he recalled.
Jones, 63, began his career at E.F. Hutton as a commodities trader in the cotton pits in the 1970s before transitioning to macro trading and founding his hedge fund, Tudor Investment Corp in 1980. He shot to notoriety after predicting the market crash of October 19, 1987, known as “Black Monday” when the Dow Jones dropped more than 22%.
A year after his 1987 bet, he founded Robin Hood, a nonprofit dedicated to combating poverty in the New York City area. Over the last 30 years, Robin Hood has given away more than $3 billion.
He has called trading “his calling.”
“Let life pull you in the direction that just comes naturally, and you’re going to find that perfect intersection of purpose and happiness,” he said.
Watch the full discussion here >>
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Julia La Roche is a finance reporter at Yahoo Finance. Follow her on Twitter. Email tips to laroche@oath.com.
