Paul Tudor Jones: Defense First

Paul Tudor Jones II (born 1954) founded Tudor Investment Corporation in 1980 after starting as a cotton floor trader in New Orleans and New York. He became one of the era's defining macro traders, and a public figure through the 1987 documentary Trader and his interview in Market Wizards. He is reported to have profited enormously by anticipating and shorting the October 1987 crash — the trade his reputation was built on. Outside markets he founded the Robin Hood Foundation, one of New York's major anti-poverty charities.

The method, in his own recurring phrases

• "The most important rule of trading is to play great defense, not great offense." Capital preservation first; opportunities recur, capital does not.
• Asymmetry: he has described seeking trades shaped like five-to-one — risking one to make five — so that being right well under half the time still compounds. This is expectancy thinking stated as a lifestyle.
• The 200-day moving average as a simple regime filter — he has said he wants to be out of anything trading below it, a rule notable for its bluntness from a discretionary master.
• Constant risk awareness: his line that he assumes every position he has is wrong, and knows where his exit is before he enters, is the psychological posture behind honoured stops.

What to take, honestly

Jones traded with information flow, staff and market access no retail trader has; copying his instruments is pointless. What transfers is the shape of the operation: small defined risk per idea, aggressive asymmetry when conviction and price agree, and an identity built around not losing much when wrong — the exact opposite of the retail default.