RE: LeoThread 2025-12-14 19-05

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Paul Tudor Jones investing framework:

  1. Trend following as the foundation
  • Core belief: never fight the tape — losers average losers
  • Primarily uses price-based technicals, with the 200-day moving average treated as sacred
leofinance
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  1. Defensive first — capital preservation is job #1
  • Obsessed with avoiding losses; defense is the chief responsibility
  • Enforces a hard 5% risk cap per trade idea, often risking 1–3%
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  1. Asymmetric bets + strict risk/reward discipline
  • Only takes trades with at least a 5:1 reward-to-risk profile
  1. Global macro with heavy use of technicals and charts
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  • Trades across bonds, currencies, commodities, equities, and volatility
  1. The 1987 crash playbook — always watch for “black swan” setups
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  • Recognized extreme overvaluation + portfolio insurance + narrow market leadership before 1987, mirroring 1929
  1. Inflation vs deflation regime framework
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  • Thinks in large economic regimes; guided by the two words: inflation and deflation
  1. Flexibility and quick reversals
  • Will flip from massively long to massively short (or flat) very quickly when trends break
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  1. Volatility as an asset class
  • Often buys cheap volatility as portfolio insurance during periods of complacency

Noted principles:

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The most important trading rule is to prioritize defense over offense
Seek opportunities that risk $1 to make $5
Never average losers
The trend is a friend until it bends

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