Mr. Jiang Ping, can be said to be the most outstanding Chinese investor on Wall Street today, was once named the &#34;Top 100 Traders&#34; of the year by the famous professional magazine &#34;Trader&#34; on Wall Street, becoming the first Chinese person in the history of the list. Referred to as a &#34;genius&#34; by the stock god Buffett.
He worked as a trader and fund manager at Lehman Brothers and Sec Capital, with an annual income exceeding 100 million US dollars. In order to retain Jiang Ping, Lehman Brothers even offered a retention bonus of nearly 10 million US dollars.
In today's world of trading, Chinese people are rarely seen. But does this mean that there is no place for Chinese people among the world's top traders? The answer is not so. In today's article, we will share with you the trading deeds of Mr. Jiang Ping, a Chinese trader at the top of the trading chain.
Jiang Ping was one of the first group of elite students studying in the United States in the 1980s, along with others such as Li Kaifu. After graduating from Stanford University, Jiang Ping began his career in financial derivatives.
Jiang Ping, from Jingjiang County, Jiangsu Province, entered the University of Science and Technology of China as the top scorer in the Yangzhou region in 1981, at less than 16 years old. In 1989, he came to the United States with 2,000 US dollars to pursue a doctoral degree in chemistry at Princeton University, and later went to Stanford to pursue a doctoral degree in finance, because this was his true interest.
He truly entered Wall Street in 1995 when he signed with the world-renowned investment bank &#34;Lehman Brothers.&#34; Initially just an ordinary employee in the technical support department, Jiang Ping's real desire was to become a frontline trader.
&#34;Wall Street has a biased view of Chinese people, thinking that we are good at math, can calculate, but cannot do business well. So when I came here, I thought about how to find a job within the company.&#34;
Jiang Ping designed a trading model that was highly practical and brought the company a lot of profits, leaving a deep impression on the boss. Soon, he finally became a trader as he had wished.
Jiang Ping's trading logic: Good trades need to reflect thoughts, the results of independent thinking. The vast majority of people only believe in things that are market-recognized, or wait for the chart to come out, things that most people trade. This market is too impetuous, not many people are willing to delve into the basics, most people only evaluate opinions and are unwilling to argue.
Treated differently and transferred to the worst-performing department, still shining
Initially, Jiang Ping was assigned to the worst-performing Latin American foreign exchange trading department in the company. That year, Mexico experienced an economic crisis, with many investors withdrawing, leading to a significant depreciation of the peso against the US dollar.
After careful research and relying on his unique sensitivity to data, Jiang Ping found that the Mexican currency was severely undervalued, with strong appreciation potential, so he bought heavily.
Sure enough, after surviving the crisis, the peso rebounded strongly, and the Latin American foreign exchange trading department led by Jiang Ping also became one of the most profitable departments of Lehman Brothers.
From 1995 to 2004, a series of global economic crises occurred one after another. However, Jiang Ping's investment performance has always been between 30% to over 100%, making him one of the top contributors to Lehman Brothers
However, the &#34;God of Wealth&#34; did not receive a reward proportionate to his efforts.
According to Wall Street rules, fund managers generally receive 10% to 15% of performance fees, but Jiang Ping's share is less than one-third of this proportion. He said, &#34;I mainly don't negotiate prices for myself.&#34;
From Lehman to SAC Capital
During his 10 years at Lehman, although he did not receive the expected rewards, he had become a &#34;thoroughbred&#34; on Wall Street through the training during this period. And his &#34;benefactor&#34; appeared at this time.
At the end of 2004, Jiang Ping planned to leave Lehman Brothers and return to China to take care of his parents. Cohen, the chairman and founder of SAC Capital Investment Company, rushed over upon hearing the news.
They had dinner at an Italian restaurant in Manhattan. Jiang Ping told Cohen that he had seen too many dark sides on Wall Street and decided to leave the industry. However, Cohen found &#34;the potential of a super trader&#34; in Jiang Ping and strongly urged him not to give up, offering generous terms to invite him to join SAC.
What moved him even more was that the other party brought a big gift as soon as they met. &#34;I have never received so much cash at once, and without any pressure.&#34; Jiang Ping said that he had worked at Lehman for many years, helping the company earn over 100 million US dollars each year, but had never received such a large bonus. Cohen made him feel like he had found a kindred spirit in a foreign land.
During the Chinese New Year in 2006, he and his wife took their two children born in the United States back to their hometown in Jiangsu to celebrate with their parents. This was the happiest Chinese New Year he had ever experienced. After returning to the United States, Jiang Ping submitted his resignation to Lehman.
He said that it is common for people on Wall Street to switch jobs, but it is rare for someone like him with excellent performance, low income, and staying for 10 years. The boss tried hard to retain him, offering nearly tens of millions of US dollars in retention bonuses, including cash, increased dividends, and loans. However, Jiang Ping was not moved because all these courtesies came too late!
In March 2006, Jiang Ping officially joined SAC, investing in G7 foreign exchange, indices, Latin American foreign exchange, bonds, and European credit, but it was not smooth sailing at the beginning, &#34;losing seven to eight million US dollars.&#34; He felt a certain amount of pressure.
Soon, SAC Chairman Cohen invited him to dinner at his home, along with a former economic advisor to US President Reagan. Seeing that he was not in a good mood, Cohen said to him, &#34;Don't worry, I don't understand what you do, but I understand you as a person, and I believe you can do it!&#34; As a result, he became one of SAC's most outstanding fund managers that year.
Farewell to Employment, Establishing Ping Capital Management
After leaving SAC Capital to establish his own fund, Ping Fund, managed independently by Jiang Ping, fell by 34.26% in its first year in 2008. However, the fund then surged by 192.73% in 2009.
In 2010, which was a difficult year for many hedge funds and hedge fund managers (they were leaving in droves), Ping Fund's value rose by 103.45% - which, in the global fund rankings of that year, could definitely be ranked among the top, even the first!
In Jiang Ping's investment portfolio, there is only $154.9 million, which some believe makes financial management easier. However, the fund is a global macro fund, and many of his peers in the global macro field are struggling.
Overseas media Business Insider described Jiang Ping's fund as follows: We don't know how he does it, but based on absolute returns, the fund invests in China, Latin America, and other emerging markets, making it one of the best-performing funds we have ever seen.
The Most Profitable Chinese Fund Manager on Wall Street
In 2009, amidst a downturn in the U.S. financial industry, Jiang Ping's exceptional investment talent helped Sachs earn a substantial profit. His personal bonus alone exceeded $100 million. He was recognized by the famous U.S. magazine &#34;Trader&#34; as one of the top 100 traders.
Due to his investment performance far surpassing many of his peers on the list, Jiang Ping was even praised as a &#34;genius&#34; by the stock god Buffett, becoming the first Chinese person to top the list in its history.
Remembering the Original Aspiration, Donating to Chinese Alma Mater
Although Mr. Jiang Ping and his wife have long lived in the United States, in 2006, Dr. Jiang Ping donated $1 million to his high school alma mater, providing support for special scholarships established at Yangzhou Middle School.
His Advice to Investors
1. Establish a Work-to-Wealth Life Philosophy
Throughout history, only a very small number of people have been able to gain without working. Ordinary people should strive for excellence in their work and rely on hard work to become wealthy. Stock trading is not considered labor. Many people are originally diligent and thrifty, but always worry that others will make big profits without working. Wall Street is very good at catering to their preferences, tempting them with small profits, and ultimately taking their hard-earned money for themselves.
2. Defend the Fruits of Labor and Holding Firm Without Fighting is the Best Strategy
The vast majority of people are unlikely to truly understand market rules, unlikely to see through Wall Street's traps. Do not enter the market blindly, do not believe the sweet words of Wall Street brokers, and safeguard your hard-earned income.
However, not fighting does not mean doing nothing, it does not mean keeping money under the mattress or simply depositing it in the bank. Index investing is a defensive strategy, and regularly investing part of your income in the stock market monthly is also a good method. The key is not to be influenced by Wall Street, not to be influenced by the media, not to be influenced by neighbors, and to persist in index investing.
Ethical professional investors should treat other people's money as their own and refrain from making major moves until the situation is clear.
3. Investment Industry is a Special Type of Labor
Its uniqueness lies in the high industry threshold, which is not easy to enter, but once inside, it is not difficult. There are many impostors, and they all have a good life. Of course, like any other industry, it is not easy to do well. However, those who do slightly better in this industry seem to receive disproportionately high income compared to their efforts.
Doctors relieve patients of pain, chefs make delicious meals, which can be considered labor. The so-called professional investment on Wall Street, in most cases, does not mean helping investors make money, but rather means taking money from investors, regardless of whether they make a profit or a loss, they still collect a hefty fee
Wall Street glamorizes professional investment as every fund manager wracking their brains to make money for investors, which is far from the truth. The reality is more akin to a quack doctor in the martial world selling elixirs, claiming to cure all diseases, or a chef drawing cakes to satisfy hunger, but the bill lists the price of delicious dishes.
Most people in business schools pursuing an MBA in investment do not want to speculate on stocks with their own money like ordinary investors, hoping for soaring stock prices. Instead, they want to rack their brains, enter Wall Street, and learn the art of raising money to become wealthy.
4. Through Trials and Tribulations, Steel is Forged
Compared to the strategy of holding on without fighting, over 95% of amateur investors lose money, and over 90% of professional investors lose money. Of course, professional money-losers can still get rich by collecting management fees through their &#34;efforts,&#34; but they simply lack respect within the industry.
How to become part of the non-losing 10%? How to become part of the 1%? Talent, opportunity, and diligence are all important. But in this particular industry of investment, these words may have a special meaning. The intelligence required for farming, education, research, and trading investments are all different. Even if one excels in their own industry, upon entering the investment industry, they should still adopt a defensive posture and prioritize defense.
For ordinary people, opportunities are hard to come by and should be cherished when encountered. As for diligence, it should not be superficially understood. If one stares at the screen, loses money, and wants to break even, the more diligent they are, the worse it gets. It can also be said that the intelligence and diligence of ordinary people may not necessarily work in the investment industry.
Many industries in the world have the phenomenon of &#34;following in the footsteps of one's father.&#34; Even in the brutal business of warfare, there are many father-son famous generals. However, in the investment industry, a true &#34;following in the footsteps of one's father&#34; cannot be found. Soros's large hedge fund was taken over by his son as the president, but his son manages everything except investments.
In the United States, the largest mutual fund Fidelity Investments, the boss Johnson was once a star fund manager, and his daughter will inherit the business. However, she has only been a fund manager for a very short time. Her succession has a taste of a British prince wanting to serve as a soldier for a year before taking over.
Children are unwilling to follow in their parents' footsteps, at least not willing to take on the most difficult and brutal part of the business. This should serve as a warning to those who want to enter this industry and hope to make money and become wealthy through investment rather than raising money.
To succeed, one needs a certain talent, opportunity, must be willing to work tirelessly, have resilience, strong willpower, patience, and attention to detail. When everything is ready and the east wind rises, one must also be prepared for a life-and-death struggle.
If after reading the above warnings, you still want to venture into the risky path of making money through investment (rather than raising money), the following insights might be helpful.
The trading process requires theory, practice, theory again, practice again, in a continuous loop to infinity.
His advice to traders on trading knowledge
In terms of theory, Mr. Jiang Ping mentioned that he has benefited more from the following types of training.
1. Mathematics:
Basic arithmetic; square roots, exponents, logarithms, compound interest; linear optimization, basic statistics.
2. Economics and Finance:
Microeconomics, macroeconomics, and international economics; money markets (Marciastigum classic); derivatives (John Hull classic); economic and financial history
3. Practical Books:
Peter Lynch, possibly the only investment expert in financial history who defeated Wall Street on a large scale by stock picking. He did not graduate from a prestigious school.
Those who want to imitate him should take a look at his photo at the age of forty (already with white hair), and then ask themselves and their families if they are willing to become like that at the age of 40; Jack Schwager, who has written many books, all worth reading repeatedly.
4. Other Books:
Reading is beneficial, the broader the knowledge, the better. Most books can be skimmed through, but some must be read carefully, depending on the specific situation. Among non-professional books, I like to read repeatedly, even buying a new copy when the book is worn out, with &#34;Jin Yong's Complete Works&#34; as the favorite.
I don't have time to read books now, so I repeatedly listen to two storytelling sessions during exercise time, one is Ms. Liu Lanfang's &#34;Yue Fei&#34;, and the other is Mr. Yuan Kuocheng's &#34;Romance of the Three Kingdoms&#34;. My life philosophy and trading views such as righteousness overcoming evil, using strategies to outwit opponents, and winning against the strong with the weak, have also benefited from these books. Stories that have been read dozens of times, every time I listen again, I have new insights.
5. Various Activities:
The current education system focuses too much on reading, even encouraging reading to death. There is wisdom in life. Working, farming, entertainment, sports, the arts, and various other fields should be understood and participated in as much as possible.
When I was in elementary school, academics were not a priority, and the school often organized activities related to work, agriculture, and the military. These experiences were very helpful for analyzing economic operations with common sense in the future and seeing through the smoke screens of Wall Street.
Even if some activities are not considered highbrow, as long as they are handled properly, they can be beneficial, even turning decay into magic. My trading skills benefited from chess and Go without a doubt. But from elementary school to graduate school, playing cards and mahjong have never stopped. Habits like card counting, card memory, and analyzing opponents were developed during that time.
At the mahjong table, everyone wants to win and fears losing, putting effort both inside and outside the cards, winners want to cash out, losers want to break even. During my trading process with the Mexican peso, I was familiar with many opponents, and many of them had the prototype of &#34;mahjong friends&#34; from back then.
6. Advanced Theoretical Books:
Are advanced theories useful? Definitely useful. But I have almost two doctoral degrees, and the advanced knowledge I acquired was useful for finding a job, but did not directly contribute much to trading.
The biggest role of these theories is when a group of Wall Street chief strategists, chief analysts, chief economists flaunt their prestigious degrees and illustrious experiences, casually mentioning terms like &#34;stochastic differential equations,&#34; &#34;GARCH,&#34; &#34;multivariate regression macro forecasting,&#34; I can watch their drama with a cold eye.
Among these people, a few are experts, and they can be considered upright. But most of them do not truly understand, and often harbor ill intentions towards investors. I learned these theories better than them back then, so they couldn't deceive me. As long as one's skills are correct and deep, when opponents come with sinister skills, they will only harm themselves. Ordinary people shouldn't be afraid if they haven't studied these theories, just plug your ears when the Wall Street propaganda machine starts running

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Jiang Ping's trading logic: Good trades need to reflect thinking, the result of independent thinking

The most outstanding Chinese trader on Wall Street: once earned $100 million a year