Travails of a Money/Fund Manager

Hi All,
For old timers in FF, they would have seen me around here for quite sometime though not as regularly as some of the frequent posters. Anyway, i am Karthik. I am a forex trader cum private fund manager cum hedge fund manager. I do all this sitting at home.

I have been trading forex for the past 9 years and it is only in the last 2 years that i have been able to do whatever role i am doing right now. The first 7 years were spent on studying, learning, creating forex accounts, blowing them up, re-funding and blowing them up again. The turning point came about 2 years back and from then on, i have been doing ok and with God's help, i should continue to do well.

I use to run my own blog, also used to write articles for forex websites and was also a contributor at one of the major forex sites (cant reveal the name here). I also ran a successful thread at FF. Due to lack of time, i had to give up on the blog and a large part of my writing. Now i just maintain my facebook page and just stick to trading the different funds.

I am not sure of other hedge funds like GS but the smaller ones do not pay their traders very well. This is what i have seen from my experience. My own private fund, though it is of much smaller size, yields me a lot more money through my profit sharing with the clients than what the hedge funds pay me.

I use price action for trading. Why am i posting in here? i really am not sure. Just wanted to share my line of thinking and also share my knowledge and also deal with the psychology of how a professional trader trades. Maybe discuss on some trades along the way. Not sure how useful it would be but i guess it will be known by how big this thread becomes.

For those who believe that fund managers like me, dont sit and post in forums, well, all i can say is that, well, i do...I trade from home and daily, most of my time is spent on waiting for the trade rather than trading per se and hence i do have a bit of time for myself.

Anyway, just a rambling of my thoughts. Will discuss more on psychology and also discuss on any questions that you might have. Would also be glad to discuss trades, trends etc...

hmmm....looks like there aint too much interest !!

Plenty interest I am sure! But on Sundays I don't think this forum buzzes as much as it does in the weeeek

so maybe i shouldnt be wasting too much energy today...:-)

Asside from the day to day admin and occasional customer story, I'm guessing running a fund is little different from trading your own account. I'd be interested in the tasks and complications you had to go through to get the fund off the ground. That would be unique and interesting.

Hi,

Thanks ns_karthik for starting this thread,personally i like learning from personal experiences because sometimes they put finesse on our own circumstances,sure am interested in following on the road to your discoveries...cheers

I have been trading FX for years and I can relate to the ongoing learning process. When I look back at trades I never took due to a lack of knowledge, it is mind boggling to me......How could I have not seen that!!!!! I don't really want to learn anything "new", but the more you trade, the more nuances you pick up....which is very frustrating to me. These nuances were there all the time, but I just never picked up on them. I have to constantly remind myself of a saying that goes "You are as good as you are, but you are not as good as you think you are". I don't know who came up with that, but it never ceases to come back to me. Obviously, you may have run into this type of psychological torment, and I would be interested in knowing how you deal with it on an ongoing basis.

I too am trading a fund for others and would be interested in swapping stories and learning and sharing from and with others the experience. Agreed though, later today/tonight there may be more interest shown.

Ok....the first question seems to revolve around the setting up of a fund....one thing that everyone needs to remember is that setting up a fund in India is a wholly different proposition than starting it anywhere else...

when u do start out looking out for funds to manage, u are a bit confused to know where to start....u usually tend to start out with funds from friends and relatives but there is always the danger that you might lose their money and hence spoil the relationship....so the first thing to do is to have targets....targets that are achievable and supported by history...targets for returns, targets for total fund required, target for DD, target for risk....all this needs to be made very clear to each of your clients, whoever it might be and we should be doing everything possible to ensure that these targets are met, especially the targets for DD and risk %.....And the first and foremost lesson, is to be honest, honest and always honest...

there are a lot more things in this, which i will be listing one by one as we go on....

Hello!
It is always interesting to know experience of managing funds.

and first question do you use leverage
if yes what is your leverage maximum
Thanks

What makes India different? Regulation? Types of investors? Religious reasons?

nothing religious in that....just that there is a lot of regulation surrounding it....so far, the reserve bank of India has allowed trading only in 6 currencies and that too against the indian rupee only....only these are allowed to be carried out from within india....alpari is the only broker in india and they too serve as an IB to the UK branch....they dont carry out any trading themselves...

the investors are also difficult to handle...for them, stocks, commodities and forex are the same....and just like in any other business, there are cheaters out there who cheat people off millions of dollars by using ponzi schemes....so even those who try and do it honestly are looked upon with suspicion...

i do use a leverage of 1:500 but i ensure that i dont risk more than 2-3% per trade and i dont have more than 2-3 trades on at the same time...

I have found Richard Wilson from hedgefundblogger.com very helpful for people who want to set up a hedge fund. He has lots of good tips.

Your original posts at FF don't really concur with the timeline you've laid out here. Is there a mistake? Just asking.

can u explain that a bit, Mr. Holmes !! :-))...

How about this.......... This is from your first post.

what is metastock and metatrading??
Posted May 27, 2006
Hi, I have been into forex for about 6 mnths

I was really hoping you would explain a bit.

Maybe I worded my question wrong. I was asking this:

If on May 27, 2006 you had been "into Forex" for about 6 months, as per your first post on FF, how can you now have 9 years of experience, with 7 years of those nine being your learning phase?

I knew that as a Money/Fund Manager, you must like to see things add up.

ok so it is more like 7 yrs....does it matter? didnt realise that i needed to be exactly right with such numbers....as i mentioned in one of my other threads, i do not realise nor do i keep track of such numbers as it does not matter, atleast to me though it seems to matter to jobless people who are around here.....

anyway, by the reaction so far, i can see that this thread is unwelcome here and it is going to be a waste of time as the judgement seems to have been passed even b4 the trial...my mistake...should have stayed away from posting in here as i have been doing for the past 6 mnths or so (yeah i know that someone is going to come up and prove that i have posted something somewhere within the past 6 mnths)..

those who know me personally, a few over here do know me, know what i am and i have enough evidence to show that whatever i have said is right....but anyway, i am no longer interested as this place is slowly becoming more about finding fault with others (even by silly newbies) rather than encouraging good trading....nothing more to add from me...c ya...

Or is it more like 4 and a half years?

And yes it is important to be accurate if you are dispensing advice and information regarding running a hedge fund and being a money manager. People may have believed the detailed timeline in your first post and assigned a greater value to your missives than they deserve.

You wrote on another post on this thread:
"And the first and foremost lesson, is to be honest, honest and always honest...

I happen to agree.