A young currency trader knocks politely on a conference room door at Kingdon Capital Management Corp. (KCMC), a Manhattan-based hedge fund. Her boss, KCMC's founder and president Mark Kingdon, invites her in with a friendly nod.

"The yen's at an eight-year low, and the Canadian dollar is at an all-time low," the woman says softly, but urgently, an unplugged trader's headset dangling from her head. "S&P's way off. Should we short the Mexican peso?"

"What do you think?" Kingdon asks, interested.

"I think we should."

"Sure," he says. "Go ahead."

A veteran of three decades of bull and bear markets, Kingdon oversees a $3-billion company that invests in a global array of stocks, bonds, currencies, and options. So he isn't exactly the type to overreact to wide swings in the market. Besides, as any hedge-fund manager knows, where there's adversity, there's opportunity.

"I knew I wanted to get into this business from the time I was thirteen, when I was given a couple of shares of stock," says the quietly intense Kingdon. "Even though the market nose-dived soon thereafter, I was taken with the idea that you could buy something that made money and then go out and do something else during the day. That seemed like a wonderful way to make a living. "

By high school, the Brooklyn-born Kingdon was already authoring an investment newsletter. After attending Columbia College in New York City and then HBS, Kingdon decided to take his first job at AT&T, reasoning that by working in the firm's pension fund administration group he would get to know many different kinds of investment outfits. In 1975, he joined one of these companies, New YorkÐbased Century Capital Associates, where he remained for eight years.

In 1983, with $2 million under management, Kingdon started his own hedge fund. "During the first five years our performance was strong but somewhat volatile," says Kingdon. "We were just a tiny firm and didn't have the analytical backup and the infrastructure we have now. "By 1988, he decided to abandon the risky path that most hedge funds take in their pursuit of juiced-up returns. "I realized I was not in the high-performance-at-any-cost business," he reflects. "I was instead in the consistent-performance business, providing above-average returns with below-average risk. "

With a fifty-person staff, Kingdon says he is now spending more time on human resources and organizational issues. "I never thought my courses at HBS on managing people would be applicable to me," he confesses. "But my job has become more administrative and supervisory. I used to think I could turn a talented analyst or portfolio manager into a mensch, but I have found instead that it is lot easier to turn a mensch into a portfolio manager. "

Kingdon believes in having a life outside work, as well. He and his wife are devoted to their two children, and Kingdon, a third-degree black belt, attends tae kwan do classes three times a week a few blocks from his firm. "No matter how tough the markets are," he laughs, "when you are out there practicing martial arts against a guy who is twenty years younger and is aiming for your head, you tend not to worry about your stocks. "

Back in the office, however, Kingdon's attention is fully on his business, as evidenced by the firm's 32 percentÐplus gross average annual return since 1983 - which translates to an impressive 26 percent in investors' pockets after fees are deducted. Still, Kingdon remains modest about his success. "It's important not to confuse investment genius with a bull market," he says with a smile.

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