Commentary

Jared Dillian
Traders Magazine Online News

Was it Worth It?

In this piece from 10th Man, author Jared Dillian discusses how the ETF revolution is less about ETFs and more about indexing; about how people have come to view stocks less as stocks and more as blobs of stocks.

Traders Poll

Would you feel better if the Chicago Stock Exchange were purchased by U.S. firm or consortium rather than a foreign one?

Yes

73%

No

4%

Doesn't matter to me

23%

Free Site Registration

December 1, 2004

The Race Car Trader

By Ingrid Eisenstadter

Alan Polo commutes to work every day on the shoe-leather express. He is just ten blocks from his New York City office. Unfortunately, the city's traffic nightmares preclude him from driving his beloved BMW or Mercedes to work. Polo, a car nut, is a sales trader with Investment Technology Group, a company known around the world by its ticker, ITG, and the POSIT matching system.

At ITG, Polo spends some of his time at the desk, where he facilitates trades for institutional customers. But mostly he is on the road, selling the company's crossing-system services and front-end trading applications.

Last October, he journeyed to San Francisco to manage ITG's algorithm-training conference. However, he did not come racing home afterwards on Friday to Manhattan. Instead, he went racing down to Los Angeles, to catch the action at California Speedway. Polo did not sit in one of the huge racetrack's 90,000 seats with a box of popcorn. Instead, he took his popcorn down into the pit, climbed into the pace car and drove onto the track.

There he opened the races for a weekend of BMW Car Club of America events.

To be sure, Polo enjoys his life as an ITG trading professional. But he does admit that work cuts down on his track time. And that keeps his BMW in the garage more than he would like. It is a race car, equipped with a welded-in roll cage, Kevlar racing seats, safety harnesses, window netting, suspension modifications and lots of other go-fast upgrades.

Polo bought the 1989 BMW M3 a few years ago for just $8,000. After some repair work, he invested another $15,000 to make it race track ready. Today, it will go 130 miles-an-hour. Still, unlike some other traders with fast cars, Polo actually drives at that speed. Polo is also a skier and a hiker, but most of his time away from work is about cars. He trades them at the same speed that others trade equities. At just 33 he has already owned 30 automobiles.

Learner's Permit

Although he's owned a handful of Porsches and the occasional Mercedes, most of Polo's cars have been BMWs. "I bought my first BMW before I had a driver's license," he recalls. It was a 1979 model 320i that cost $2,000. He was just 15-years-old. Eighteen months would pass before he was old enough to get his learner's permit in his home state of Massachusetts.

During that interval he fixed up the old car with the help of his father and brother. After he got his license, however, he drove the car for just six months before he sold it, for almost twice what he paid. Thus began the habit of a lifetime. By the time he was in college he was routinely buying used BMWs. He would repair, drive and then sell them. Polo has sold most of his cars at a profit and used the money to help fund his next car.

After years as a driving instructor, trader Polo formally launched his second career - race car driver - earlier this year. He had finally met the numerous qualifications necessary to obtain a racing license.

Track Time

"They don't let just anyone out there," Polo explains. He had to demonstrate that he had sufficient hours of track time, pass medical exams, get personal recommendations, and driving-instructor approvals. "And, of course, you have to get a race car," he adds.

While Polo has run a number of races this year, his most memorable moment is still his first race-school start. Moments after the green flag dropped, he recounts, he was doing 90 mph. His was one of four cars heading into a turn that was wide enough for only two.

They were all just inches apart. He squeezed through and was second into the turn. "But coming out of the turn I got a bit too excited," he recalls, "and gave the car too much gas, and it spun around."

Polo found himself facing the two cars that were behind him. But, he adds, "fortunately they avoided me and I spun my car back around to catch up with everyone." Polo says of his race-car hobby, "It's high stress and big fun."

For him, that's the same as a day on the Street.