It was a chance encounter after a back injury that turned Ben Davies’ attention from sports to the markets, but the same competitive spirit still drives him in advocating for monetary reforms. Cutting his trading teeth at Greenwich Capital, he saw firsthand the events and conditions that led to the 2008 financial crisis.
Now having started his own firm, Hinde Capital, Davies is a champion for free markets and allowing them to function independent of central bank intervention, all while operating a long-bias gold fund to protect investor purchasing power. We caught up with him to get his view on the gold market and the role of central banks.
Futures Magazine: Ben, you went to school to be an athlete and came very close to competing in the Olympics. Can you tell us how you went from athlete to trader?
Ben Davies: I was born in Cambridge and went to the Perse school in Cambridge. That was a very academic school. I think it is fair to say that I enjoyed the academic rigor but my real passions [were] sports and psychology. I came to appreciate academia years later because of trading as I wanted to learn for learning’s sake, not because of the enforced nature of exams.
So, I made the decision when I was 18 that I wanted to follow my true passion, which at the time was sports science. I focused on exercise physiology, sports psychology and biomechanics. I became a sports science and finance student at Loughborough University, which is very well known for its sporting programs. Early on, it was really psychology and sports that attracted me to competition and developing winning strategies that comes with that, which is very pertinent to trading today.
At that time I was a field hockey player, and being a sports psychologist and going to college there, I was able to devote a lot of my time playing for Loughborough, Wales and Great Britain. As you said, I was on the Atlanta Olympics squad, but I had to pull out because of a serious back injury early on. I will say that my passion had probably since passed, and if you are going to do anything well, then you need to be authentic and have integrity, otherwise you’re not going to give your best for it. It made me rethink my career, and I made that move from athlete to trader.
It was a chance discussion that lead me to a few days’ work at Man Financial, which at the time was a private commodity group, and I’ve been bitten by the bug ever since. I think it was a manifestation of ‘Could I do it? How would I have coped with some of the famous crashes?’ I wasn’t trading in 1987, but how would I have adapted to it? That led me to make that shift. It was part forced, but part that desire to pit myself against the market.
FM: Where did you get your break into trading?
BD: It’s interesting having come from the background I had as an athlete just how many people wanted to hire me more for my sporting prowess than perhaps my academic capabilities. Ultimately it was Greenwich Capital. That was my breakthrough into trading markets at the macro fixed-income level. I also was very fortunate to meet my now work partner, Mark Mahaffey, who co-founded the London office of Greenwich Capital. For people who don’t know, Greenwich Capital was the No. 1 primary dealer in U.S. government bonds, agencies and to some extent mortgages. [Mahaffey] was the chap who really instilled in me the inquisitive nature you need to pursue the truth in developing your rigor and understanding of the markets.