This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Lessons Learned From the Hedge Fund Crisis

OKLAHOMA CITY -- Robert Lawton no longer manages his own hedge fund.

Like so many others in the battered industry, Lawton exited the business as the stock market crashed last year. He fared better than most, however, since he simply agreed to sell his firm and expects it to keep thriving.

He still invests money for a living, too, although he now works as an old-fashioned stock broker. Lawton no longer calls himself a "hedge fund manager," a title that now carries enormous pressure and a hefty dose of taint, though he shares their newfound caution.

Lawton has abandoned the one high-risk strategy that actually worked wonders during the market plunge last year. Reversing a decade-long practice, he finally stopped shorting stocks that seem overvalued and destined for big losses. Since late November, when the market fell to its lowest level in years, he has stuck with bullish bets on stocks that look ripe for sudden gains.

In today's brutal market, however, Lawton often rushes to cash in. He wound up taking profits on Bank of America (BAC - Get Report), for example, only to buy the stock at a higher price so he could make money on it once again.

"I've been kind of spinning in and out of stuff," Lawton admits. "I have sort of mixed feelings about that. I used to work with a guy who had this sign that said, 'Traders die broke,'" he explains. "And I've lost tons of money doing all the wrong things, including trading. But there are so many opportunities on the long side [that] I feel good taking my profits and walking away."
1 of 4

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
BAC $12.33 0.49%
BX $24.66 0.90%
FIG $4.26 0.00%
SNHY $26.82 -0.11%
WMB $11.40 2.20%


Chart of I:DJI
DOW 16,011.33 -15.72 -0.10%
S&P 500 1,847.92 -5.52 -0.30%
NASDAQ 4,276.1290 -7.6240 -0.18%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs