STREET DOGS

Hedge fund trader Michael Platt reportedly made $2bn in 2019. Four years ago, Platt decided to go it alone and closed BlueCrest Capital Management to clients. But he continued to speculate using his own money and money belonging to BlueCrest partners and employees allowing him to increase leverage and take on more risk.

MARKET MAKERS

Some years back, when asked by Jack Schwager in Hedge Fund

Market Wizards what he looks for when he hires a trader, Platt replied: “I want market makers, people who know that anything can happen. The type of guy I don’t want is an analyst who has never traded – the type of person who does a calculation on a computer, figures out where a market should be, puts on a big trade, gets caught up in it and doesn’t stop out.

“And the market is always wrong; he’s not. Market makers know that the market is always right. You are wrong if you are losing money for any reason at all. Market makers have that drilled into their head. They know value is irrelevant in times of market stress; it’s all about positions. They understand the markets will trade against positions. They get it.

“I look for the type of guy in London who gets up at 7am on Sunday when his kids are still in bed and logs on to a poker site so that he can pick off the US drunks coming home on Saturday night. I hired a guy like that. He usually clears five or 10 grand every Sunday morning before breakfast taking out the drunks playing poker because they’re not very good at it, but their confidence has gone up a lot. That’s the type of guy you want – someone who understands an edge.

“Analysts, on the other hand, don’t think about anything else other than how smart they are.”