How I Started My Hedge Fund

Josh here - Dan McMurtrie and his partners founded Tyro Partners, a New York City-based hedge fund, at a time when hedge fund closings are much more common than emerging fund launches. Dan lists some of the most important things he's figured out on his journey. He also talks about how one of the most underappreciated sources of alpha is being nice to people.
You can follow Dan's renowned Twitter feed / alter-ego Super Mugatu here:
/ supermugatu
Tyro Partners homepage here:
www.tyropartners.com/
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Investing involves the risk of loss. This podcast is for informational purposes only and should not be or regarded as personalized investment advice or relied upon for investment decisions. Michael Batnick and Josh Brown are employees of Ritholtz Wealth Management and may maintain positions in the securities discussed in this video. All opinions expressed by them are solely their own opinion and do not reflect the opinion of Ritholtz Wealth Management.
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[@makedollarsandsense7194]

I like his style. Keeps that neck protected at all times. Makes him immune to margin calls

[@ackilla86]

LMAO...thank you

[@ryansaadat9095]

"Protect your neck from volatility with derivatives" - Wu-Tang Clan

[@schnaiderservius2957]

Haha you're right

[@colevidmar1191]

Very clever, also hilarious

[@WrenchGuru.]

Lmao

[@fourlokody]

this was worthless: he basically said general advice like network, be nice, know what your doing. I wanted to know how he started a hedge fund. i didn't learn that.

[@ThePrometheus617]

True but that advice is timeless. Especially in a career with tons of human interaction.

[@saltymonke3682]

that's the secret. He won't tell you whom

[@ClearOutSamskaras]

@Kody Parsons Get in touch with him.

[@davidoconnor1773]

Not really, you just weren't paying attention. He gave you tons of insight as to how to setup and structure a hedge fund, what to expect in the first few years, what not to do, how to scale, and specifically which people to connect with as you grow. If you want "the 8 steps to starting a hedge fund", go on Amazon. Even just knowing that good stock picking doesn't make a hedge fund, and that thats not why people invest in them, is probably good enough info to make a lot of people rethink trying to start their own fund.

[@pillsberrydopeboy851]

you need a track record. like dude said, you need to have a history of making a lot of money on stocks

[@udaykhanna9403]

That's one of my favorite conversations on the Compound. So intuitive and real. Thanks guys!

[@MrSupergibs]

This is really a good lesson in people skills, expectation management. Well done to all of you!

[@purepatrick]

That was a great interview. I enjoyed watching this young entrepreneur talk about launching his fund. A very mature discussion that many young folks should listen to. More of a how to become a successful person with financial success as a back drop. The interviewers asked insightful questions and really kept things moving. Great video. Keep up the good work!

[@drunkntigr]

Feb 20 How I Started My Hedge Fund. Feb 28 Day In The Life Of A Burger Flipper All jokes aside, thank you very much for doing this interview. Always love seeing different perspectives.

[@The091298]

Thank you so much Dan, Josh, and Michael! I'm going to rewatch this several times to absorb as much as I can.

[@GSD-]

Great advice and story! I’m cheering for this guy

[@isaiah3107]

Never heard of either of you guys but I thoroughly enjoyed watching this and I'll be subscribing.

[@ethanmce]

Such brilliant and succinct observations from a person that young, absolutely, a must see.

[@kathleenmuir2033]

So many great points: recognizing the need to consider Marketing, operational backend, safeguarding capital,. Loved the line' have durability during volatility. You all left the best bit to last. Be nice and be a giver. Brilliant.

[@blakeneher]

How many margin calls has turtleneck gotten since this interview?

[@aceshah6671]

I hope he had some short strategies

[@victornyamu2547]

Just Us bwahahaha. and we're still going lower

[@JohnDoe-xt6ow]

I was wondering how he made out, too. It was a vicious market. But with right strategies, you can make money in ANY market. Shorting, of course, needed in this market and getting out quickly when you were on the wrong side of things. A buy and hold strategy would have been painful.

[@kevinjacob2416]

Lol

[@edwardblack9263]

So. He is 28 in 2020 and launched in 2015. He launched a hedge fund at 23. Think about that.

[@saleh.hashmi]

yeah bs.... he has no wealth.

[@free2rhyme214]

And Vitalik Buterin was 19 when he wrote the Ethereum whitepaper. There's always people like this.

[@Tom-kx9mn]

Sounds like he used his parents money. No way you’ve built enough of a reputation on the street by 23 to attract outside capital.

[@5thHouse]

@@saleh.hashmi if he had wealth his clothes would fit him correctly

[@52baldingindianjanitor72]

@Alexander Leblanc I think if anyone claims to start a successful running hedge fund by 23, it warrants at least some scrutiny. Hard to fathom that you built that large of a network as this guy preaches by that age, there's probably more to the story. Not saltiness, just reasonable suspicion.

[@MrSupergibs]

I actually think that's the right approach for life in general.

[@karmathebrit7856]

The people he was talking about was literally the WallStreetBets reddit 😂

[@brianbirnbaum9760]

LOL yes

[@virx7944]

Watch your tone ! That’s the meme and the legend you are talking about, show some respect.

[@neils1501]

more of this content please

[@Growth_Cartel]

I’m glad that I came across this video. I started a Hedge Fund recently and I’ve been look for videos and writeups to keep enhancing myself.

[@fedelixtaboe1842]

Congratulations 🎉

[@garyleider2701]

You're doing great stuff! Thanks!

[@markeinsteinog]

Never get tired of watching this.

[@JohnDoe-xt6ow]

Good advice. Nice guy. Liked hearing how he set up his companies and where.

[@theartofblank]

Super Mugatu! The Compound is like the jelly of the month club - the gift that keeps on giving. More Dan and Tony Dwyer please - can we get them weekly?

[@TheCompoundNews]

thanks for watching! We'll have them back!

[@DexterTheDuck]

Great insight from Dan and I thought Michael asked some really great questions. You need to have Dan back on again.

[@Sooperkoala]

I love this discussion so much. Honesty is the best policy

[@AT02031234]

First video I've seen from your channel and subbed as a result 👍🏻

[@HowItHappened]

Really interesting discussion with insights from the inside. Thanks for sharing!

[@rossmoore1155]

“I didn’t have my grandmas money” Dan has Philips Andover on his resume......guess he got the diversity high achievers scholarship to there and notre dame right?

[@ablanikihyung7801]

lol good one

[@dogestranding5047]

Maybe not grandma's money, but grandpa's money, uncle and aunt's money, mom and dad's money, money from friends of the family, and of course money from his professor and from other school connections. It's not as if all hedge fund managers come from fancy private schools though. Just seems like it's a lot of them.

[@seancullen99]

The books are yet to be written and the final losses yet to be tallied on how much a significant number of major hedge funds have cost the US economy since mid Feb 2020 because quietly and in the background, they have been bailed out en masse by a government that deemed them too big to fail. Why? They leveraged long and aggressively on a market they thought couldn't fail, and now we are paying for their gambling as we always do. And make no mistake, it was pure gambling, with multiple 10s of leverage with money they did not have, which was in the end, your money.

[@brianbordenkircher52]

Thank you for your perspectives!

[@bigray712]

first video i've seen on this channel and very impressed. some real gold nuggets here.

[@patrickl.2761]

That was great ! Thanks guys

[@InclineWealth]

Great video. Curious, did he close his first fund or keep it alive and merged with two other partners?

[@Hz-qz5mr]

Any books you recommend to learn on how to start the hedge funds

[@veticanagitau8861]

Wow, managing your life with psychological risks!! I love his approach to it all!

[@UnkleRiceYo]

You guys ask great questions!

[@hassaninvesting]

Awesome video!! Always learning

[@jeffreybuffkin9108]

8:12 - When Josh Brown mocked quants, I felt personally attacked 😂

[@AW-ud6eh]

I felt that ): I’m guessing he’s not a quant

[@TheCompoundNews]

Lighten up - JB

[@rudrabhojbhati2355]

Usually only salty weaklings condemn quants.

[@TheBRICClub]

1st time watching you guys. Excellent show

[@brandonvillatuya9539]

20:49 the way he said "do it" sounded funny

[@blockedia7290]

Awesome interview!

[@bateaubaybubble3730]

There was only one Star Wars movie. The original. Apart from the final comment, this is a very good interview and teaches so much about starting and running a personal relationship type business. Thanks.

[@YardLimit]

Very interesting. Thanks!

[@jay-trades2455]

Hey guys, I own 19 shares of Tesla stocks, what would be my best option insurance play incase they drop any lower?

[@ibrahimhassanlabib3085]

top quality content awesome keep it up !

[@abhushanchataut4913]

Loved it. My dream is opening a hedge fund after all the skills and networks i build and learn. Keep uploading videos. Learnt a lot

[@abhushanchataut4913]

@@kenolent8611 Thanks a lot

[@mikesannuto2044]

You guys are awesome. Love your channel. Great stuff and very inspiring.

[@TheCompoundNews]

Thanks so much, Mike!

[@DP-dc2vv]

Age aside here, where's the edge? He's a stock-picker. Looks like he'd worked for about a year before starting the fund and his partner was an analyst at Citi for a year before. Congrats on making it work, but genuinely confused who's allocating to him.

[@jeoboden]

60/40 is the edge

[@flyingiguana409]

@@jeoboden 33/33/33 is the new edge

[@JohnDoe-xt6ow]

Scan the markets, looking for extremes to invest in and/or short-term trends to jump onto. And, remember, it is NOT concentrating on the money you want to make that will make you money. Nope. Not at all. It is making sure you manage concentrate on limiting any losses to keep them small while you can keep them small. If you avoid big losses, you will make money on your winners. Concentrate on making sure you keep losses low. Use OCO orders a lot. Use a trading platform that allows quick trading like ThinkorSwim by AmeriTrade. Know the fundamentals as well as the technicals. Many know just one or the other. But most importantly, know that the market is always right and that there is no need to take more than a small loss on anything. Don't love anything. Just love: 1) Not losing money. 2) Taking a profit when the rise stops (even if you only end up with a small part of that stocks/investment's overall rise. We've been doing extra-ordinarily well by doing this.

[@edwinrosario2353]

Great video!!!

[@kurt2rsenjazz]

That was wholesome

[@Fairplay2015]

I like that all three here have BIG Mics in front of them...

[@flippantfishtaco3132]

It's interviews like these that are the reason I subscribed to this channel. How can I get more of this and less of the daily chatter episodes?

[@parfaitbusinessservices3751]

Very good questions in this interview

[@jaefourtrades]

Tons of Gold in this one!

[@garrettsite]

What is the book they mention at the end of this? The go-giver?

[@nc6022]

What execution platform is everyone using? and why? (Bloomberg vs Eikon vs...)

[@wcc1212]

Great interview.

[@berlin5403]

How much return a hedge fund give in normal market setting ?

[@LGH1847]

Excellent

[@jorghoffmann9865]

Some intresting sideview. I thought that I can get a closer look to their strategy and investement aspects.

[@llClassifiedll]

What’s the intro instrumental? Sounds like 90’s Hip Hop...something you’d hear A Tribe Called Quest, Das effex, or Gang Starr rap over

[@MRZEROTOINFINITY]

I took some notes! A hedge fund is not just stock picking..it's a business. You need systems in place to handle all inbound leads. Anything under $5M per client is just a lot of tedious paperwork. Stick with 20-25M. Starting a hedge fund may be down the road!

[@traviskonermann4054]

Nice notes

[@MRZEROTOINFINITY]

Travis Konermann 💪

[@MrBrosifXD]

haha sureee

[@MRZEROTOINFINITY]

sbtopjosh 👍

[@th3SyLvEsTeR]

"How do you develop friendships"

[@3lions9]

Amazing interview, so much valuable information

[@TheCompoundNews]

Thanks for watching!

[@jay-trades2455]

Hey guys, I own 19 shares of Tesla stocks, what would be my best option insurance play incase they drop any lower.

[@kwanelemoima1029]

I saw Dan McMurtrie and Todd Krakow first came into mind

[@nshpokerfish]

Exactly, a fat Todd Krakow

[@ahmedzakikhan7639]

How do you start your Hedge Fund career without a IB/PE job fresh off your university ?

[@mago3331]

great thanks for this !! I wonder how we will network now in the post corona world

[@gatti3933]

michael is tuned the hell in. Jesus this guys intensity

[@FinanceOptimum]

*Cool conversation*

[@marcusvos7060]

OK that blazer is making his hands look tiny.

[@kirkkim1818]

He's dressed like a bouncer at a hotel club/bar.

[@robp.8807]

This is great. this is actually true for all companies. I do social and price data analytics for retail companies. I can do the numbers and great at creating revenue with my insights. but stuggle with getting new clients expcet my main single monster client.

[@TheKhalMykeyShow]

Fuck yeah I’m glad I’ve found this channel

[@dogestranding5047]

He makes it sound pretty difficult in raising money for the fund, but I also remember having seen a fund called "The Astrologer's Fund" or something along those lines. How the hell did they manage to convince people to entrust their money to them?

[@Anthony-rn7oj]

WD Gann a very successful investor swore by astrological trading so I think he gave it some sort of "credibility" despite it sounding completely ridiculous and more than likely, it is ridiculous for most people.

[@schnaiderservius2957]

This was a great interview! Great questions was being asked.

[@rampcapital9895]

Please link to Dan's turtleneck/jacket combo in the show notes. Thx.

[@Lifeissorich.]

Ramp!

[@sohambhatia]

it was definitely a fit lmao

[@lancesaville6191]

ready to captain the enterprise

[@michaelizzo5823]

Will read " The Go-giver"

[@crastogi1]

The key is to internalize it.

[@mulemule]

*Micro-primer for those desiring **_effectiveness_** with ANY start-up. Bottom Line? Soft-skills empowered by **_integrity_** rocks; fast-and-loose **_walks._* 🏆

[@BradonFoot]

This is a top 5 episode. Nice job guys

[@Mohamed-ui8yz]

this page is fucking great ! love the material

[@cosmo1kramer]

Not heard of anyone launching hedge fund in the last 10 years

[@pantherenebuleuse]

Wow I really liked what he said!!!!!

[@jeffreykirton1780]

“I wouldn’t say I was a huge dick. I was cocky” good tshirt material

[@jonahfaulkner1211]

I'm getting that book, that's what I'm doin

[@jmoz]

Mans got a blue blazer on and a yellow turtleneck JEEZ

[@apga1998]

Don’t forget! For the hedge fund manger, this can be an extremely lucrative business. But for the investors? Warren Buffet trashed a group of hedge funds and won a 1 million dollar bet when the S&P index 500 fund that he was using as a comparison, far outperformed a group of highly paid managers over many years. Good luck!

[@Starmaker908]

Smiling ovation...

[@yashmatai]

brilliant

[@CS-qc7np]

There’s nothing wrong with grandma’s money! 😂 And, at 12:00 Josh said something I try to get my kids to understand.

[@shubhamjain6996]

He got 5 missed calls from momma during this 21 minute video

[@Helloobiwan]

19:40 what is book name?

[@lionlegal2018]

This guy sounds smart.

[@viennawong]

Gee, one biggest reason of my doing hedge fund is that I can shout at people

[@bicyclingaround8405]

should have started out with introducing the guy as supermugatu :)

[@antonomaseapophasis5142]

4 out of how many notches? Are you bringing it down from 11? Or 100?

[@wilsonmanch6773]

Anyone can do good when the market is doing good. Even an idiot can pick winning stock in such time. But it is what you can do when market is crashing. The difficult part is when is it going to crash? Tomorrow? Next week? Next month? Next month? Next year? So it is the risk management and solid rock cold stop that matters.

[@ScalperSpecltr]

What number did they start with? Please has anyone caught the number from the interview? Did he mention it? I couldn’t figure it out.

[@4405jack]

They didn't mention it, but hinted towards it being under 10MM

[@ignaciosuarez8205]

3 Million. 9:32

[@moisesdelcastillo6703]

Quality Stuff!!!

[@TheCompoundNews]

Thanks for watching!

[@Greyson69420]

Seriously good stuff in here...despite the turtleneck...

[@arunrk5590]

Did he survive the march crash ?

[@moneyprintergobrr6501]

I will keep trading my own many and grow and focus on performing the best not worry about regulations and convincing investors.

[@InvestToLive]

This was a really great video. The take away is that you CAN start a hedge fund at any age and economic cycle but you should be prepared to face adversity both from the markets and your closest associates.