What I learned from managing $2.5 billion

robleregal

Junior member
11 3
I’ve been active in the stock market for 6 years as of this month (November, 2018). I started a firm while in University and things picked up recently when I was given the opportunity to manage some investments for a couple of Saudis, I took the opportunity and headed to the Middle East. I’ve managed large sums of money on my own before but this was, and still is, uncharted territory for me. I am managing two and a half billion US dollars and the clients have high expectations - which leads to a lot of pressure. I just wrapped up my first month managing the funds and this is what I’ve learned:

First thing I really learned is that technicals go out the window when filling orders in the tens, and sometimes hundreds of millions. Overall, I’m a technical trader (I consider myself a swing-trader) and my analyses have always been based on the moves of the market and large institutional investors. But now, I could be a market mover myself and realized very quickly that others were following my moves. At first I thought this would be advantageous (I could increase the price of a stock and eventually just sell them off after a few days or even intraday) but it wasn’t. The market was slow to react to big buys and fast to react to sell offs, which lead to my second realization:

People FEAR much stronger than they HOPE. I picked up some PACB shares mid October I was filling orders for the first 10 minutes after the market opened. A few moments after I finished filling my orders, the price increased by half a percent. By 10am the price plateaud at +0.89% of my average share price. I sold less than 10% of my holdings the same day and watched the price plummet. I decided to wait on this position for a few days seeing that I was down 4% by the afternoon.

It can be discouraging seeing a portfolio down millions but one benefit from being a technical trader is that nominal amounts don’t affect the psyche, the focus is on the real return. Eventually made a tiny profit on the position but learned something crucial:

You can’t day and swing trade hundreds of millions at a time and expect productive returns. So I decided to divvy up the funds into 2 - $1.5 BB in longterm investment and $1 BB day/swing trading. I divided the $1 BB allocated towards day/swing trading into 20 smaller portfolios of $50 MM. I committed to opening and closing 20 positions within the week - I found this strategy to work the best.

As of yesterday’s market close, my returns for the month were 4.8% (3.2% from closed positions, and long term investment is up 1.6%), before deducting my fees and commissions. I’m still exclusively invested in US markets but will be venturing off into Asian markets soon. These are just my observations after one month of managing $2.5 billion and the results are subject to a number of factors including market conditions at the time of trading, in no way is this intended to be investment or financial advice.

Happy trading,

Roble Regal
 
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Pat494

Legendary member
14,621 1,578
Everything is just rosy while you are making money for them. Don't forget the money isn't yours. Especially the Saudis can be very short of patience and understanding if you make a mistake. As everyone here knows - the markets can for no apparent reason behave chaotically sometimes.


Good luck and it might be wise to have a packed suitcase just in case if you are over there.
 
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robleregal

Junior member
11 3
I keep a decent percentage, so there's that. I'm living and working in the UAE, the clients just happen to be Saudis. But thanks for the advice.

Roble Regal
 
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danpadcas

Junior member
16 0
I agree with Pat494 as things get tougher when you are managing somebody else's money with this amount of capital. The psychological aspect plays such an important part at this level that it might be really hard to sleep tight sometimes.

Good luck with your trading !!!
 

NVP

Legendary member
37,758 2,100
Hi RR ....

I have to say my cynical mind is struggling to believe you are truly managing 2.5billion in funds for the saudis .......

sorry and hey its just me ......with nearly 50 years of being around gamblers and traders and the whole snake oil world that surrounds much of it you will have to excuse my feelings and sceptism on T2win and other forums where i reside.....but its kept me solvent and profitable over that 50 years so not going to ditch the armour now !

Nothing personal....

sure reduce volumes and go for more liquid markets ........in the currency world that money wont really scratch the surface on the big pairs so i would even suggest you look at currencies as well to mitigate the size .....

ive just checked Facebook and indeed you have an interesting profile ......so good luck to you

good trading and investing
Neil
 
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tomorton

Legendary member
8,402 1,338
I see that Phd student got a life sentence after a 5 minute trial !
They live on a different planet and about 5 centuries behind.

https://www.msn.com/en-gb/news/worl...-for-uk-government/ar-BBPWqMb?ocid=spartanntp


I've tried to find out some background to this this am but without success. I'm guessing it was all kept discrete by family & friends until last month, maybe on Foreign Office advice while negotiations were on-going.

Hopefully the sentence will be at least commuted as looks likely but I just think there's more to be learned about what went on - like what credentials was he carrying, had he made contact with UAE ministries previously or on arrival, had similar projects been done before, what preparations had his university made prior to the project, who paid for the travel etc., was this a commissioned investigation or just a private research enquiry, was this just an individual's shake-down attempt to get a bribe, is there an internal factional power play going on? etc. etc.

The UAE is in a bitter dispute with Qatar, showing sympathy in any media for Qatar is an offence there. The Gulf as a whole is politically a highly sensitive area, and the UAE is an ally of Saudi Arabia, which makes it automatically prone to hostility from anti-Saudi factions.

Who the hell did the risk assessment on this field trip?
 
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