“If everyone thinks one way, it is likely to be wrong. If you can figure
out that it is wrong, you are likely to make a lot of money”
Jim Rogers was born in Maryland and spent his childhood in Alabama. His father, James Beeland Rogers, was a plant manager at a chemical factory.
Young Jim displayed a knack for business early on – his first endeavour included selling peanuts and picking up empty bottles left behind by fans at baseball games.
After his schooling, he went to Yale University from where he graduated with a degree in History in 1964. He then went to Balliol College, Oxford University to pursue a second BA degree. He earned his degree in Philosophy, Politics and Economics in 1966.
Jim Rogers joined the investment bank Arnhold and S. Bleichroeder in 1970.
There he met George Soros with whom he would later enter into business ventures. Both left the bank in 1973 to create the investment fund, Quantum Fund. Over the next few years their business prospered. It was one of the few hedge funds in the country at that time and was extraordinarily successful.
Since Rogers was deeply passionate about the investment market and through his tireless efforts, he made Quantum Fund one of the first truly International Funds. He decided to retire in 1980, at the age of 37, to pursue his other passions. Furthermore, he began to manage his own money and started investing in commodities and stocks all over the world.
After his retirement, during his trips abroad, he learnt a lot about how the various stock markets work in different countries and was able to invest his portfolios in a wise manner. His worldly knowledge about stocks and success in the investment business earned him credibility as an economist. He served as the moderator of WCBS’ ‘The Dreyfus Roundtable’ and FNN’s ‘The Profit Motive with Jim Rogers’ in 1989 and 1990.
Moreover, Rogers had a lifelong dream of riding across the world, and from 1990 to 1992 he undertook a world trip on a motorcycle covering over 100,000 miles across six continents. He recorded this adventure in the book ‘Investment Biker’.
In 1998, he founded the Rogers International Commodity Index. But then, the travel bug bit again the investor and started off on another world tour in January 1999. This time he travelled through 116 countries and covered 245,000 kilometres in a custom-made Mercedes.
He only returned home after three years in January 2002. This trip was chronicled in the book ‘Adventure Capitalist’ which became a bestseller.After that, he started to appear regularly on Fox News ‘Cavuto on Business’ in 2002. He was also invited to appear on other financial shows. His book, ‘Hot Commodities: How Anyone Can Invest Profitably in the World’s Best Market’ was out in 2005.
In 2007, Rogers shifted to Singapore since he felt that Asian markets offered better investment potential and finally, in 2011, he started a new index fund called The Rogers Global Resources Equity Index which focuses on the top companies in agriculture, mining, metals, and energy sectors.
Rogers advises to buy low and sell high, in other words: try to find something that is
unbelievably cheap, where a positive change is taking place. He also states that he tries to do enough homework to make sure he is right. In addition, it also must be cheap so that if he is wrong, he does not lose much money. Jim Rogers gives an example: in the 1960s, General Motors was the world’s most successful company, but one day, a GM analyst went to the board of directors with the message: “The Japanese are coming.” They ignored him. However, investors who did their homework sold their GM stock – and bought Toyota instead.
According to the investor, one should invest only in things that they know something about. The mistake most people make is that they listen to hot tips, or act on something they read in magazines. They should just stick to what they know and buy an investment in that area. That is how one gets rich.
Jim Roger’s best investment was when he and George Soros started the company in 1970. He had only $600 in his pocket and within 10 years, the portfolio had gained 4,200 percent.
In 1970, when Jim Rogers was still new to the markets and the business, he invested all his money in puts in January, which people thought was nuts. Furthermore, he sold his puts the day the market hit bottom and tripled his money. Two months later, he sold short several companies, however, in the next two months, markets kept rallying. In result, he lost everything. This episode taught him that he didn’t know enough about markets and market timing.
Rogers believes that it is better to offer scholarships to students rather than schools, so he decided to give money to students and schools around the world. In his perspective it’s better to give scholarships to students rather than schools since students need the money more than administrators.
Therefore, in 2013 he created, alongside with his wife Beverly, the Rogers Foundation which is one of the largest privately funded charitable foundations in the State of Nevada. Its mission is to transform the lives of children and young adults through art and education. Until now the foundation has given more than $89 million dollars to children and programs that support them.
This article is in our December Newsletter
Ana Rita rijo, MSc in Mathematical Finance
João Ferreira, MSc in Mathematical Finance