Straight Talking

As I have a unique vantage point in evaluating traders, I have been asked to write an evaluation of the trading of Hedgehog’s Simon Townshend.

I have been in the trading business for thirty-six years, with the last eight years spent coaching professional traders from around the world, including Simon.

I have seen the trading of hundreds of professional traders. All of the traders I coach are full-time, professional traders and many, like Simon, are very accomplished world-class traders.

In 2007, I started working with Simon, similar to the way a coach works with an Olympic athlete. My goal was to help Simon optimize his trading, achieving a consistent positive return while holding risk to acceptable, low levels. Top performers in all fields recognise the importance of professional coaching. Indeed some, like Tiger Woods, even use multiple coaches. Trading is just the same which is why all top traders carefully select a coach to help them finely hone their already impressive abilities.

When we first met, Simon ever the professional already had a clear business-like trading plan that outlined exactly the trades he intended to take, the risk he was willing to accept, and his plan for the various contingencies that can affect trading. I found it unusual, even among professional traders, that Simon had such a well thought-out plan, but Simon is not the usual trader.

In trading, having a plan is the first part. Executing the plan is the second and most important part. Here again, Simon is the complete professional. I can say without equivocation that Simon executes his plan, keeping his discipline and exploiting the opportunities he identifies, every day. Simon does not waver in his discipline, nor is he afraid to take the reasonable trading risks that are consistent with his plan.

In my experience, it is this unusual combination of discipline and willingness to exploit opportunities that makes a world-class trader. Simon is clearly such a world-class professional trader.

If I may provide any further information, I would be happy to do so.

Former President of Rand Financial Services Inc.

www.ElectronicFuturesTrader.com
Jeff@JeffQuinto.com

Jeff Quinto’s October 2008 Blog Extract

Remember the wild markets of 2008? Insane volatility killed many traders and investors alike. In October volatility hit its most extreme level, yet with patience, discipline and greatly reduced trade size it was still possible to make money. Veteran trader Jeff Quinto has worked with some of the biggest names in the industry; Monroe Trout, Bill Dunn and Paul Tudor Jones to name but three. This is what Jeff had to say in his mid-October blog article where he referred to Simon as one of his two favourite traders:

Two Great Traders • 10.16.08

The markets have gone from interesting to bizarre. Friday the Dow futures had a 1,000 point range. Monday the Dow was up a record 936 points. Today, the CBOE’s volatility index, the VIX, reached 80. We used to think the markets were volatile when the VIX was in the 30’s.

So, with all this in mind, we can agree the market is volatile. But, what do traders do when faced with this unprecedented volatility?

• Fearful, timid traders hide from today’s markets, afraid to trade.
• Overly aggressive traders just get more aggressive, hoping to be rewarded for their bold, but undisciplined trades.
• Smart traders approach today’s ultra-volatile markets with caution and patience, knowing that their careful, disciplined trade has a reasonable chance of yielding positive results.

Two of my favorite professional traders are examples of just this smart trader mentality. One trades a fund from his home in the rolling countryside south of London and the other trades his own account in an equally pleasant setting in suburban New Jersey.

Both are gingerly trading today’s wild markets knowing that their disciplined trade will be rewarded as long as they are patient. Both are nicely ahead for the month of October and my guess is that each will end the month with reasonable, but not outsized profits. Each is carefully picking his battles, looking to identify opportunities and willing to miss potentially good trades that just do not seem right.

When I first started making money on the floor, I wanted to be a big trader. I wanted to have huge positions and make big money. After seeing my account and my blood pressure swing wildly with my oversized positions, I decided that the key to making a real living trading over the long run was consistency.

The two traders, from England and New Jersey, understand this. Each is exploiting the market consistently and each will continue to have success over the long run. That is why this is the tale of two great traders.

As for me, I am proud to serve as the trading coach and mentor for each of these two great traders.

Wishing you success in your trading,  Jeff

Copyright © 2008 Jeff Quinto All rights reserved.