The Invisible Hands: Top Hedge Fund Traders on Bubbles, Crashes, and Real Money, Revised and Updated

Chapter 12

The Plasticine Macro Trader

“The Plasticine Macro Trader” is an equity specialist who says he sources trade ideas from the voices in his head and manages risk by being a piece of plasticine—malleable and flexible, able to take down gross exposure aggressively to limit the downside risk. We sat down in his white-washed loft office in a leafy residential neighborhood in a major financial capital. You will not find this manager in the usual hedge fund haunts of midtown Manhattan or Mayfair, London. He is asocial by admission and thoroughly contrarian. He doesn't mix with his peers for information, have drinks with the guys, or seem to need confirmation of his theses by others. He does concede that he is trying to develop more vices over time.

During the course of a two-hour interview, he twice more refers to voices in his head, and I am never sure if he is serious. At times self-effacing, he can oscillate toward egocentrism, comparing himself to his hero, George Soros, when describing short positions in the Icelandic króna: “I want to be known as the man who bankrupted Iceland.” Moments later he is self-deprecating once again, saying that he has no friends and often doubts his abilities. “No one wants to work with me. I'm a bit of a circus freak.”

Having once worked for an asset manager for pensions, then run a long-only mutual fund, he is not afraid to offer scathing comments about those “arrogant people who think it's okay to lose 30 percent of their clients’ money so ...