BOSTON Hedge fund manager Tim Sykes made and lost a small fortune fast. Now he plans to earn it all back and let average Americans follow him on the road to riches, one trade at a time.
Sykes' Cilantro Fund Partners hedge fund collapsed amid heavy losses in October, a year after the 26-year-old trader was named as one of the $2 trillion hedge fund industry's most promising young stars by Trader Monthly magazine.
Now he is reinventing himself and shedding the $2 trillion hedge fund industry's veil of secrecy in favor of being a trader for anyone with an Internet connection.
"Starting on November 1, I am going to repeat my feat of turning $12,000 into $1.65 million," Sykes told Reuters. "And this time I will do it on my Web site and be completely transparent. I will use a regular discount broker so that everyone can follow along."
Each evening, Sykes, who sometimes placed bets at home dressed in a blue bathrobe, plans to describe his every move, providing a trading primer for other aspiring millionaires.
During its heyday Sykes' Cilantro fund returned 70 percent per year, which helped turn a $700,000 investment into a $3 million portfolio. He had already turned his $12,000 Bar Mitzvah money into $1.65 million as a teenager.
"He amassed a reputation and a lot of money at a young age," said Adam Sussman, a senior analyst at the TABB group that conducts financial markets research.
"But a lot of people get their 15 minutes of fame and then fade," Sussman said, adding, "Now it will be a question of whether it was only 15 minutes or whether this guy will be able to stick around."
After the highs, Sykes plunged because he was stuck in an illiquid stock -- Cygnus E Transactions Group that spiraled lower and now trades at 7 cents a share.
"I was impatient and really wanted to grow the fund to the big time. I wanted the expensive suits, I wanted the $20,000 watch. I wanted to earn as much money as I could," Sykes said.
While Cilantro will be counted among this year's hundreds of industry casualties, Sykes' losses pale compared to those of Jeff Larson's Sowood Capital and Brian Hunter's at Amaranth Advisors which lost billions.
But Sykes often rubbed the close-knit industry the wrong way.
He grumbled about rules, bristling at regulators' restrictions on who could invest in his fund -- millionaires only -- and the fact that big investors like pension funds and endowments passed him by. "I don't want to deal with any regulations," he declared, adding that some people say he made a mockery of the hedge fund industry with his bad behavior.
Most hedge fund managers like to stay mum on how they make money to avoid copycats and regulators' wrath. In return for being allowed to use trading tools like leverage and short-selling, hedge funds cannot advertise.
But Sykes acknowledges his need to be in the limelight and jokes about having a big mouth. He has appeared on cable business news station CNBC and in a six-part documentary "Wall Street Warriors," published a book "An American Hedge Fund," and writes for TheStreet.com financial Web site.
Trading is in his blood, he said.
"I'm calling this the movement for free speech for hedge fund managers. The hedge fund industry is just incredibly restrictive," Sykes said.
While the lucky blue bathrobe was lost in one of his many moves and he acknowledges that he is not a very good investor, he is confident he can become a millionaire again.
"The first time it took me four years. Now it will probably take me 10 years."