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and types of situations. Analysts support the senior portfolio managers. Then there are traders. While most of the portfolio focuses on the United States, the London office is a good base for global trading. There is no investment committee. The bonus reward system is based on Singer's discretion.

As general partner of Elliott Associates, Singer is responsible for all positions. He is the senior risk manager and has input on position size. His goal is to delegate responsibility to people and let them make decisions. He is the mentor and makes creative additions. He approves and validates what the person has done—to make sure that person has done the thinking correctly.

During the typical day, Singer first looks at the world through the newspapers, computers, and news events. After he assesses the price movement, he then talks to the portfolio managers, analysts, and traders as well as his contacts on the Street. He tries to move positions along and put out fires. He has input on positions that can be built up. He looks at different segments of the portfolio to see what needs to be adjusted. Is the timing right? Is the size right? "I try to add value and subtract pain." He does not spend much time talking to clients.

Singer achieves satisfaction on many fronts—making money for the fund, doing something clever, and helping someone to learn.

Singer, his family, and the principals are the largest investors in the fund. A no-trading policy exists which means no employee can have a personal trading account. All employee trading money is invested in the Elliott funds.

RISK MANAGEMENT

A manager cannot rest on his laurels; he is only as good as his previous quarter's performance, says Singer.

For the period since Elliott's track record began in 1977, the average annual return is about 15 percent. The year 1994 was a flat year for Elliott while most other hedge fund managers were down. Singer attributes 1994 to a credit squeeze and unusual cross-correlation. The first down year occurred in 1998.

He is of the view that the markets have been benign and that tougher markets lie ahead. He feels the stock market is in the process