Colm O’Shea: Trade the Present, Not the Prediction
A masterclass in risk, adaptability, and the brutal honesty of reacting to reality
Featured in Hedge Fund Market Wizards, O’Shea made his mark managing macro trades for George Soros before founding COMAC Capital. His career spans crises, bubbles, and booms—not because he knew what would happen, but because he knew what to do when it did.
His edge is simple: trade reality, not stories.
“I don't try to predict the future. What I do is react to the present.”
O’Shea approaches every trade as a hypothesis. He defines upfront what would prove him wrong, and the moment the market delivers that signal, he exits. There is no emotion. There is no debate.
“A trade is a hypothesis. You have to be prepared to abandon that hypothesis when it’s invalidated.”
He does not believe in rigid rules. Rules give the illusion of control in a system that is inherently unstable. What matters is flexibility—the willingness to change when the market demands it.
“Traders who are successful over the long run adapt. If they do use rules, and you meet them 10 years later, they will have broken those rules. Why? Because the world changed.”
This mindset is rare. Most traders cling to their ideas, hoping the market will validate them. O’Shea listens to what the market is actually saying.
He doesn’t short bubbles just because they’re bubbles. He waits until the market turns. That’s when the trade exists. Not before.
“Would you have shorted the Nasdaq in 1999? You can’t just be short because something seems overpriced. You wait until people start to care… You sell on the way down, not up.”
This isn’t conservatism. It’s precision.
O’Shea deliberately runs low risk. Not because he’s timid—but because he understands that consistency compounds. His fund returned 11.3% (In a low volatility fund, this is insane) annually with volatility and drawdowns well below the average macro manager. His success wasn’t built on bold bets—it was built on smart exits and intelligent sizing.
He knows the game isn’t about being right. It’s about staying in the game.
“The most important thing is not to lose money. And that means cutting your losses quickly.”
He prefers interest rates and FX because they are liquid, transparent, and grounded in global macro fundamentals. He avoids markets where emotions and narratives dominate the tape.
Everything he does is grounded in empirical observation. Not theories. Not models. What matters is what the market is doing—not what it’s supposed to do.
“I like to say that I don’t trade markets. I trade perceptions of reality.”
O’Shea’s Core Principles:
Risk First. Always define the point of failure before you enter.
Adapt Relentlessly. What worked yesterday can destroy you tomorrow.
Don’t Predict—React. You don’t have to know what’s next. You just have to know what’s happening.
Respect the Market’s Timing. A good idea at the wrong time is still a bad trade.
Trade Liquidity. Stick to assets where you can enter and exit without friction.
Detach from Narratives. Believing too hard in your idea is how you blow up.
Treat Every Position as Temporary. If the thesis breaks, the trade is over.
Colm O’Shea doesn’t need to be right. He just needs to act fast when he’s wrong.
And in a world where most traders are betting on outcomes, he’s betting on behavior.
Read his full interview here.
Against All Odds Research
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