Last Updated on 7 September, 2021 by Samuelsson
Steve Clark is an American investor, founder, and Head of Risk at Omni Partners, LLP. He served as Director, Head of International Equity Trading, and Director, Co-Head Proprietary Trading at NatWest Markets and Nomura Securities, respectively, between the years 1991 to 1997. Also, Clark was the director of Hartford Asset Management Limited from 2000 to 2004.
He grew up in the outskirt of London, with no father around. With no trading experience, Clark worked installing stereo speakers when his friend told him about trading jobs in the city. Steve graduated with a double major in Accounting and Finance from Miami University. He received an MBA and MSG degrees in Boston College. Clark is a holder of the CIMA®, CFA, and CFP® designations.
Clark took some odd jobs in the city before finally getting a chance at running a market-making book. And his first chance at trade came when he had to fill in for a trader on holiday during the stock market crash of 1987.
Clark learned a valuable lesson in market making during that crash of October 19, 1987. He thought to quote the price so low until all the sell orders diminish, but he lost millions of pounds on his book. Fortunately, he still wound up as the most profitable trader in his group. He attributed his success to his ability to exit losing trades on time. He also makes his trading decisions based on news.
Steve trades on order flow information and filters for stocks with enormous momentum and large volume. He would check the chart to check whether the price had reached a specific high or low from the previous period. He says he’s not a fan of predictive analysis.
He left his market-making job at Warburg for a bigger pay at Lehman Brothers. He soon discovered he couldn’t make money at Lehman Brothers after leaving his former employer, an environment filled with order flow information.
Over time he began getting connections with trusted brokers, using their order flow information to track short-term market sentiments on news and event. If his position is not in sync with momentum, he will exit his trade. He believes in buying when the market is in an uptrend.
Clark gives one crucial piece of advice to traders: do more what works and what doesn’t. Review your profit and loss to see what works and what’s doesn’t.
In an interview with Jack Schwager on Market Wizards, he talked about his ups and downs, which began when he lost the initial capital used in starting his first hedge fund. When everything the odds are in your favor, you need to take advantage of it. However, if your trades start going in the unintended direction, that is a sign that your judgment was wrong. Your job as a trader is to make sure your equity curve goes from the bottom left to the top right.
In his words: “Really good traders are also capable of changing their minds in an instant. They can be dogmatic in their opinion and then immediately change it. If you can’t do that, you will be caught in a position and be wiped out.”
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