An American Hedge Fund by Timothy Sykes

An American Hedge Fund: How I Made $2 Million as a Stock Operator & Created a Hedge Fund
by Timothy Sykes

“…an excellent tell-all story about the truth of setting up, starting and running a Hedge Fund from scratch. A highly entertaining read that should help educate aspiring fund mangers and give them much need guidance to tackle the risks of playing and surviving Wall Street’s fierce game” – Chris Perruna

In addition to the quote I provided for Tim’s blog, I felt the book was highly entertaining and a great read. It flowed and I easily finished it in two sittings and was always eager to start another chapter. I learned several things by reading the book as Tim helped me confirm even further that I probably don’t want to trade as a small fund manager on Wall Street.

I first learned about Tim while watching Wall Street Warriors on the HD channel MOJO. The show was good enough to catch my attention enough to watch the entire series and really get into the stories of each character. Tim went on to write this book and was kind enough to send me an advance copy last summer.

Too many books are boring or lack the meat to grab my attention for 200 or more pages. Tim did a great job at telling his story and keeping the reader interested from chapter to chapter.

An American Hedge Fund is an autobiography about Tim’s venture of trading throughout college and then ultimately forming his own hedge fund after he graduated. He gets into great detail of trading during his college years and then details his experiences within the dark halls and exclusive clubs of the Wall Street money game.

I recommend the book to anyone interested in starting their own private hedge fund or to anyone that would like to hear the story of a college kid that turned $12,415 into $1.65 million in three to four short years. (I can’t say I have made that much to date)

I do have a few cons about the book
(for the readers of this specific, trend trading blog):

Tim was predominately a short trader in college and within his fund. He didn’t exclusively trade short but that was his bread and butter. I have traded short and have covered the topic several times on this blog but my bread and butter are trends on the long side.

Tim focused on trading small penny stocks, which I honestly feel are crap, but that is just my opinion. Regardless of what Tim traded, he was successful and that is the most important moral of the story.

Understand what he was trading and how he did it. I believe Tim is focusing more on money management and a psychological approach as he tries to repeat the feat in his latest endeavor. If I had one suggestion, I would tell Tim to forget about the $12,000 start and get properly capitalized and trade using sound position sizing and expectancy tactics:

111607_tim.jpg

TIM – Transparent Investment Management

I’m going back to my Bar Mitzvah Gift Money roots of $12,415 and opening an account with a discount online broker, intent on repeating my feat of turning this small sum into $1.65 million. This time around, my goals are not solely monetary, but to show everyone the process, the successes and failures and the hard work that goes into accomplishing such a feat.

Each night, I will post all my thoughts, investment ideas and trade details on my website TimothySykes.com. This won’t be some highly technical trading talk BS and it certainly won’t be boring – c’mon you know me better than that!

Final Word:
I do recommend the book to anyone that enjoys stories about Wall Street and trading. I can’t honestly say it is the next Reminiscences of a Stock Operator but it is much better than some of the other trash I see on the shelves of Barnes and Noble or Amazon.

I wish Tim the best of success during his current journey of duplicating his trading success from 1999-2002. Please take the time to visit his latest blog and follow along with the success of TIM:
TimothySykes.com

Comments

  1. Hey, posting all your trades on the internet before you make them is not exactly groundbreaking anymore … I know some bloggers that have been doing that for a year or more …

  2. Chris…I come to see you as a professional who puts a considerable amount of work into their site. But, for the 1st time I think you should have refrained from giving so much credit to this guy. He is nothing more than a publicity seeking trader (not unlike many in this business). He is not a reputable trader in the business and I find it strange such a failure gets so much spotlight.

  3. SAM,
    You aren’t the first one to say that (I have received a few e-mails from readers of my blog). Like I said, I can’t call the book the next Reminiscences of a Stock Operator, not even the same league.

    As far as credit, I just said to read the book. I honestly read the entire book without a problem. He sent me an advanced copy so I promised to write a review.

    Would I ever trade like Tim? NOPE! As I said in the post and have always said: Penny stocks are CRAP in my opinion! I also noted that he is undercapitalized with the $12,000 challenge. That doesn’t teach anyone about the correct way of trading.

    Read the book and form your own opinion about the story. However, I don’t recommend trading like Tim unless he started using better money management and position sizing techniques. It doesn’t take one long to figure out how the best in the world make money (CONSISTENTLY)!

  4. “He is nothing more than a publicity seeking trader (not unlike many in this business). He is not a reputable trader in the business and I find it strange such a failure gets so much spotlight.”

    Sorry, but I gotta respond–of course I’m seeking publicity–I have a book out! There are 200,000 books published each year and its a battle to get noticed. You write a book so you can be heard and I will give my last dying breath to be heard because I think my message, namely that responsible financial speculation is a worthy and character building endeavor, is important.

    As for being a reputable trader in the business–what does that even mean anymore? I’ve obviously done a lot things right and some things wrong (as for failure, I’m 1/3 off my highs aka not the end of the world), but I fess up to it all in this book and that makes me better than most (considering the typical industry sugarcoating). I agree with Chris that Penny Stocks are crap, buuuuut you can make money from that crap if you learn how all the BS influences stock prices. I love how everybody and their mother looks down on Penny Stocks and writes them off without really looking into them too deeply. Check out the charts from the trades in my book (I just posted them at http://timothysykes.com/index.php/charts.html and tell me you don’t see some very similar (aka predictable) patterns.

    And as for being undercapitalized with $12k, you’re damn right I am! I willingly checked myself into prison (I’m even forgoing all the pro trader software in favor of a discount online broker) so my readers could better relate. I’m gonna show EVERYONE how Penny Stocks are particularly well suited to smaller accounts and hopefully change a few people’s minds about me and my much derided market niche.

  5. Nice follow-up Tim!
    We’ll follow along and see what you can do. Remember, I said penny stocks are crap in my opinion (who said I was right).

    However, why would I trade penny stocks when small cap growth stocks have consistently grown my net worth to date (since late 1990’s).

    Everyone has their own niche on Wall Street and the majority of the readers here trade like me so you may get slack from them.

  6. Fair enough.

    Back in the early days of my trading career I had the experience of working with an individual who became a household name due to his publication in a Market Wizards book. He later saw his hedge fund blowup within a couple years of opening it. He has since tried to hide that fact by offering some very lame excuses for the reasoning behind the fund closing. His pitfall was the self-absorption that guided his everyday with great lines like; “do you know who I am?”

    In the case of Tim I do give him credit for at least owning up to his failures and not trying to avoid them. Publicity is a double-edged sword in this business. I actually do hope he manages to pull of his goal. For me, that will be noteworthy.

    Good mediation Chris.

  7. Ok, I just recently learned of this guy, Tim Sykes, and have visited the web site he set up and watched a few of his idiotic appearances on various news outlets such as CNBC. This is HILARIOUS.

    Tim, if you are reading this, listen up:

    Much of what I’ll say is redundant but you know NOTHING about what you claim to know about. You are a rank amateur who has learned enough surface information about an industry so as to come across as being knowledgeable enough about it to teach to others. The only people that take you seriously are complete newcomers to this game that know next to nothing, because to a complete amateur you sound like you know what you are talking about. You have learned enough about trading to pretend and claim to have traded and that’s about it.

    Trading your parents money via an online retail account is not a fund, but is laughable. Your story is just that, a story. “I turned my 12k bar mitzvah money into 2 million”. It reads like bad spam I get in my inbox but the journalists eat it up like cake. Your web site is hilarious because you are an enormous idiot and I will continue to visit it for free laughs. I wonder if you know how stupid you are or if you have truly convinced yourself that you have learned something valuable enough to write about?

  8. I gotta say, it’s admirable Tim that you’re going out there and attempting to prove the naysayers wrong. I look forward to tracking your endeavors.

    If there is one thing we can all agree on it’s that you are a furious marketer. I’m beginning to wonder if you have a twin brother.. everywhere I turn I see your mug!

    The important thing is to keep doing, keep trying, keep improving, failing, succeeding along the way. Everyone finds their path in this way.

    good luck Tim

  9. Thanx Tate–marketing is just my latest obsession in a long string (tennis, stocks, fine dining)–people can say what they want, but the fact is there are very few people willing to put in 16-20 hours days day in and day out. that isi the main reason why I was such a successful trader–I never stopped learning and looking for more information, patterns, etc. No0w it’s the same with promoting my publishing company because it’s such an inefficient market and there’s such great opportunity here. It’s pretty sad that brutal honesty is a revolutionary / controversial business model, but that’s the financial world we live in! Hopefully, my inevitable success will inspire others to stick their neck out and detail not only their successes, but their failures too!

  10. Tim,
    No one can deny that you have been super successful with marketing yourself and your story. One day you can use your marketing success and Bullship Press to promote my book (if I ever write it).

  11. Tim=OK,but Needs New Career says:

    I read Tim Sykes mediocre hedge fund book since I knew him at Tulane, and like him as a person. However, the book is an empty and uninspiring story about how Sykes became a self-absorbed irresponsible stock trader. This book is NOT a “classic” and story is NOT “Rocky-like”(as author Sykes claims). This book is basically like a blog of an average person who got lucky trading stocks and then his luck ran out (which it really should be – blog and nothing more).

    Beware of all the phony glowing reviews for Sykes Book. Its the good ole boy network in high gear where authors/investment advisers use the buddy system to give fake good reviews to each other.

    Sykes put the term “stock operator” in title in order to confuse all future book searches for Jesse Livermore’s excellent story (Reminiscences of a Stock Operator, by Edwin Lefèvre (1923)). This cheesy trick might help book sales, but needless to say, Sykes has nothing in common with the great trader Livermore.

    Sykes comes across like a hyper/immature/video game player-type Trader, which worked for him for a few years; then the law of averages caught up with him. His “return to the mean” continues during the past two years; and his very poor investment strategies are DOWN -37% since Jan 2006. His continuous bad performance throughout 2007 shows that he does not learn from his mistakes; and readers can only cringe while watching Sykes slow motion demise into a worthless snake oil salesman.

  12. Latest replier, please stop spamming against my book, or at least try not to get busted like I’m about to do to you by providing the link below that shows how many fake alliases/reviews you’ve been using. Seriously man, did I break up your marriage or something?

    http://www.blogsmith.com/profile/1390356/

    (Yup, all those diff. reviews, like the one above, are from one guy!!)

  13. Don’t listen to a word from Timothy Sykes or his alerts without reading this revealing report

    Stock trader investment newsletters are just CRAP written by marketers that don’t really trade. Don’t buy into this lie!! Get the TRUTH here!

    http://www.timothysykesexposed.com

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  1. […] to be outdone, one of my favorite stock bloggers, Chris Perruna, posted a sweet book review on his site , calling my book “…an excellent tell-all story…highly […]

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