It's down Hille all the way to $10m

01:43, Jan 31 2009
FINANCIAL ADVICE: Whether human nature, or the deeply ingrained DIY culture, financial advisers say Kiwis are reluctant customers. And finances being more complicated than shifting house or mending fences, money management is not a national strength.

Oli Hille has one of those jobs that most of us can only dream of. He's his own boss, works 25 hours a week, holidays nine weeks of the year and cruises in and out of the office.

Oh, and he's well on his way to making a million dollars this year.

Actually, he's shooting for $10 million – but what's another zero when you've broken six?

Above the slick, stainless steel, cafe-quality espresso machine in his spacious office in Christchurch seaside suburb Sumner, a photocopied cheque for $10 million is taped to a wall adorned with world-trade time clocks.

Mr Hille wrote it to himself and post-dated it December 31, 2008.

The stylish 43-year-old smiles as he admits his "extremely out-there, difficult, but not impossible, goal".


"It would be a colossal year by anyone's standards but traders do that because you can make that sort of money," he says confidently, relaxing into a leather sofa.

The method to his money-making madness? Currency, commodities and a hedge fund strategy known as "global macro".

"When you trade global macro, you can make money just as easily when markets go down as they do when they go up. If you're willing to trade anything around the world, you don't really have to be concerned with falling equity markets or falling property markets – there's always something going on with currency, there's always something going on with commodities."

At the moment, he is hot on the "short New Zealand dollar against the Australia dollar" but is otherwise lightly invested after a "good" run in the first quarter of the year, turning $150,000 into $370,000.

Most of those gains came from agricultural commodities, which enjoyed a "massive run-up from the middle of January till the end of February".

The secret, he says, is buying high and selling low – the inverse of the usual stock market convention. The strategy is predicated on a commodity or stock hitting a new high then going even further.

"When something gets to a new high, or a new 20-day high, by definition there is no one holding that commodity or stock who is in a losing position, because they must have purchased it cheaper."

Unknown forces also factor in, he says. "These reasons may come out weeks or months later, or not at all. But if there is a groundswell of buying that pushes prices to a new high, there is likely a good reason for that and so buying at that high will often result in prices going higher still for those reasons that you don't know, but that the groundswell of buyers do know."

Needless so say, he does a fair bit of reading on the subject and during the course of a day studies up on trades, successful traders and market trends.

"At the moment I'm sitting on the sidelines," he says.

"The only commodity I have that I'm trading is corn and the reason I'm trading corn is that at the end of last week, it reached an all-time multi-year high. I'm simply waiting for the other food commodities to hit new 20-day highs and, when they do, I'll be in again."

A dabbler since the age of 18, Mr Hille took up "fulltime" trading in 2007. Working an average 15 hours a week, he made more than $170,000 net profit from 51 good trades.

That's a good year by any measure but he has already made triple that in the first three months of this year, so his $10 million daydream may not be a total fantasy.

So is it luck, skill or good karma? Mr Hille, who gives a not insignificant amount of his disposable income to charity, chalks it up to sheer determination. He says anyone with an inclination can make more money than they can lose as a trader.

To hear him talk, he makes it sound easy: "Trading is the most fun you can have at the computer, using your skills and knowledge to turn $100,000 into $275,000."

The prospect of losing at the same rate doesn't seem to faze him.

"Sure, you're trying to predict the future but as you gain knowledge and experience you learn to stack things in your favour, so instead of being a 50/50 coin toss, it can be a 60/40 or a 70/30 and once you get into a 70/30 if you do the same trade 100 times in a row you know you're going to make money seven times out of 10.

"You may lose money three times out of 10 but you can handle that because you cut your losses. If you can put yourself in a situation where you've an even 55/45 chance, it's plenty to be able to trade on."

Despite his cool-headed calculations, there aren't many Kiwis willing to place their bets making a living in the same manner. "The consensus is under 100 nationwide," he estimates, ironically taking the number as an encouraging sign. "Compare that with the large number who make an income from property and that gives you an idea of the upside potential of the increase in numbers if and when more people embrace trading as an income source."

THOUGH he has degrees in accounting and commerce, he professes to be mostly self-taught when it comes to trading and says you don't need an education to do well.

"I wouldn't suggest that anybody immediately quit their day job and try to make a living, but if you've got an interest and passion, then I think it's something just about anybody could start doing."

Reading up on the subject, is the starting point, he says.

To that end, he has written extensively about the tricks of his trading experience in chapter 8 of his pet project: a "lifestyles" book ( aimed at helping people fulfil their dreams.

In the book (he also writes fiction and children's stories), he propounds his home-spun philosophy and strategies to create the ideal life, modelled on his own.

"Sometime in my 30s I woke up to the fact that life is about lifestyle, and life isn't about working your butt off for somebody else, collapsing into your chair at the end of the day and watching television for a couple of hours, going to bed, and doing it all over again."

By maximising his earning potential in contracted business hours, he has carved out an enviable amount of leisure time.

He also handles the accounts for two charitable organisations, one a Christian international aid agency, the other a local charity that helps children. He doesn't hide his religious beliefs (biblical quotations festoon his office) or his ambition to make more money so he may do more good – though without sacrificing the lifestyle.

He subscribes to the tithing principle of giving away 10 per cent of his disposable income and hopes one day to be in a position to flip the equation, giving away 90 per cent and keeping a tenth.

As for giving up work, as far as he's concerned, he has done that.

"In a sense, I'm retired now because one definition of retirement is doing what you want to do. And so I'm doing that now. If you gave me $100 million to trade I'd trade it. I wouldn't trade all of it but I'd trade just because I love it."

While waiting for the $100 million to materialise, he is staying focused on the $10 million marker. "It's an extremely out-there, difficult goal, but it's not such a daydream that it's totally impossible. If I visualise it and believe in it . . . who knows!"

The Dominion Post