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Renaissance Technologies Corp.
$2.5 Billion
Jim Simons continues to defy logic. In a year when most hedge funds lost money — and the few that were in the black generally managed less than $1 billion — Simons, the renowned founder of East Setauket, New York–based Renaissance Technologies Corp., generated a hard-to-fathom net 80 percent return at his 20-year-old flagship Medallion Fund. What makes this feat even more incredible is that Simons, one of the members of Alpha ’s inaugural Hedge Fund Hall of Fame (June 2008), charges a fat 5 percent management fee and 44 percent performance fee. To put it another way, Medallion — which has about $7 billion in assets — was up almost 160 percent before fees. Renaissance, which had $25 billion in total assets at the end of 2008, began this year with about $20 billion, presumably because of redemptions.
Simons won’t discuss his strategy, except to say that it is based on rapid-fire trading across almost every possible market and that it relies on computer-driven programs designed by an army of more than 100 Ph.D.s. Publicly disclosed information is limited largely to quarterly reports of equity holdings, which amounted to $27.6 billion at year-end 2008, down from $57.4 billion 12 months earlier.
Alas, only the 70-year-old award-winning mathematician and his partners, employees, ex-employees and friends can invest in Medallion these days; Simons returned outsiders’ money in 2002, and each year he gives back money to existing investors to keep the fund from growing too large. Outsiders can invest with Simons through his firm’s two other funds, Renaissance Institutional Equities Fund and Renaissance Institutional Futures Fund, both of which were down last year.
