Street Stories

Hedge Funds, Trend Following and Alternative Investments

Jerry Parker of Chesapeake Capital: Former Turtle on His Own

Sept/Oct 1994, Vol 1, No 7

The $35 Million Man

By Ivy Schmerken

How does a trader who earns $35 million spend his money? How about making America better?

For Jerry Parker, the unpretentious super trader from Lynchburg, VA, the most important work occurs around the kitchen table. Thats where Parkers wife, a certified teacher, home schools the familys three children.

A religious man, who in his spare time loves politics, Parker donates considerable sums to political campaigns in his home state as well as to missionary Christian charities.

"I was a small town person and Richard Dennis rescued me from leading a normal life," says Parker. A turtle, who trained under Dennis from 1984 through 1988, Parker founded Chesapeake Capital Management in 1988.

Today, he employs five other traders, who monitor more than 85 futures markets, 24-hours a day. Leading a less glamorous life than Wall Street hotshots, Parker still comes to the office everyday.

"Trading for Rich, you got in at 7am and at 2pm you watched the Cubs game. When you become a CTA, you have to raise money, hire people, do research keep track of performance and trade." Running the business is making sure everybody else knows what to do. When hes on vacation, Parker still checks in to see how the markets are doing in Australia, England and Japan. Though traders follow their computerized instructions, he still calls in several times a day to see how much theyre making and how much theyre losing. "You cannot control yourself," he admits.

Several consultants praise Parker for running a "lean operation." "Theres people who have twice as many employees and manage the same amount of money," admits Parker. Since the technical trend following style follows its computer models [the firm is 90 percent systematic and 10 percent discretionary], "were not really interested in people who are experts at the French stock markets or German bond markets." "It doesnt take a huge monster infrastructure - not Harvard MBAs and people from Goldman Sachs," Parker retorts. This February, Parker plans to visit foreign seminaries in Australia, Pakistan, India and Thailand, that teach preachers around the world. Hes already met Charles Colson, the former Watergate figure who started a mission for prisons. Parker ponders the next step beyond trading. Politics? Perhaps. Short of running for political office, Parker donates to political campaigns. Another billion dollar trader Another is [sic] role model George Soros: his foundations have given away over $300 million to foster capitalism in the former Eastern bloc countries.