The Ledger
Every statement that passed quotation and attribution checks. Mix any filter with any other: certainty 1/5, debate potential 5/5, or both at once.
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Renaissance Ignores Company Identities Because Fundamental Narratives Are Distracting
“So they don't even know the companies involved. They find that distracting.”
Jim Simons Overrode Renaissance's Models Despite Public Claims
“Simons, when he gives speeches to you, he talks about the key is they never override the model, and they don't usually override the model, almost never do, but as I write in this story in the book, there are times when Simons has stepped in and said, guys, we'…”
Renaissance Trades Non-Intuitive Signals That Other Quants Avoid
“They also do things like they embrace non-intuitive signals, signals that they don't really know why they work, but they're scientifically proven. And Lots of other firms are uncomfortable with that approach. I don't want to overdo it here. That's not a bulk o…”
Zuckerman Is Not Convinced Renaissance Can Continue Historic Returns
“It does raise questions about the future, and I'm not convinced they can continue these kind of returns.”
No Firm Executes Trades or Manages Slippage Better Than Renaissance
“There's no one who does a better job of figuring out when to trade, how to put on trades. They look like high frequency sometimes because they layer into positions. They know slippage. Early nineties, going back to Henry Laufer, early nineties, they were figur…”
Simons Made Bob Mercer Step Down Over Political Morale Backlash
“Simon's heard about it, and he was worried about morale, and he had to, and I write about a scene in the book, he had to go to Mercer and say, you got to step down, not necessarily leave the firm, but you can't run the firm because our morale is getting hurt, …”
The New York Post Favored Negative Stories on Murdoch's Rivals
“I quickly figured out that every negative story I wrote about Rupert's competitors was getting really good placement in the paper, so I did a lot of those.”
Banks During the 2008 Crisis Were Not Out to Screw Homeowners
“Most people assume that the banks were out to screw the homeowners. And I don't think that's the case. I'm not saying they're not blameless.”
John Paulson Suffered From Post-Success Investor Overconfidence
“He made the classic mistake of the overconfident investor, too much AUM, and he started doing things like bank stocks and pharma stocks, gold stocks”
Renaissance Is Not HFT, Holding Positions Two Days on Average
“We're talking on average about two days, and people lump them in with high frequency and they're not, but it's not to suggest they do it as they do it back then, but we're talking a few days on average, sometimes less, sometimes more, moments to months is how …”
Early Renaissance Trading Was Essentially Sophisticated Technical Analysis
“What they were doing wasn't so different from technical analysis. I mean, we all sort of poo poo, and we kind of look at it as alchemy and hocus pocus, but they saw themselves as maybe more sophisticated, more scientific approach to technical analysis in that …”
A Static S&P 500 Code Glitch Blocked Renaissance's Equity System
“He found this glitch. He found a screw up on the part of Bob Mercer, who was a super duper programmer, but he had messed up. There's a number that wasn't updating. It was an S&P 500 number that was static. And it was really more their hedging and their offsett…”
Renaissance Avoided Wall Street Hires to Protect Intellectual Property
“He doesn't hire from wall street. He never has interest. If you worked on wall street, it's hard to get a job there. And that helps because when they leave, people don't usually go to wall street. So I don't know if I think he stumbled onto this. I don't think…”
Renaissance Uses Self-Teaching Machine Learning for Unexplainable Trades
“Machine learning is at the heart of the firm in modern times, and they were making trades without realizing why they were making the trades. The system teaches itself”
Renaissance Shares One Unified Codebase Unlike Two Sigma
“It's also the case that they are much more collegial. They work together. It's an open system. Everyone can see the code as opposed to other technology firms, other hedge funds, and there are many different models. So you look at like a two sigma, my understan…”
Jim Simons Did Not Develop Most Renaissance Algorithms Himself
“In some ways I was surprised that he didn't come up with the algorithms most of the time, but he's great at asking questions and prodding and pushing. And have you considered this? You might want to try this approach. So people internally say his genius is man…”
Renaissance Has Accurate Financial Data Dating Back to the 1700s
“They do have better data than everybody else. People are catching up. It's not as much an advantage anymore, but they've got stuff going back to the 1700. That's accurate and gives them patterns that people don't necessarily see.”
Jim Simons Was a Top Geometer of the Past Century
“Before he started trading full-time in 1978, he was one of the most acclaimed mathematicians, especially as a geometer over the past 50, maybe even a hundred years.”
Jim Simons's Dual Quant and People Skills Drove Returns
“I think that's part of the reason why the returns have been so ridiculous is that he's a unique breed. He could do both, the quant side, the mathematics side, but also the personal and relate to people and manage people.”
Henry Laufer Was the Key Figure Behind Early Renaissance Models
“Henry Laufer was the key guy. So he was a mathematician, a very quiet, humble, really super smart, well respected, and almost acclaimed in that field. And he's the one who came up with different approaches, things like days of the week, comparing what trades w…”
John Paulson Knew Nothing About Mortgages Before Profiting Off the Meltdown
“John Paulson was unlikely. He was a merger arb. He's the one that made the most money on the mortgage meltdown. The guy didn't know anything about mortgages. He owned a home or two over the years”
Medallion Fund Uses Leverage Sometimes Reaching 10 to 1
“And they use leverage on top of that, sometimes as much as 10 to one or more, depending on the opportunities and such.”
Renaissance Medallion Generated 66% Annual Pre-Fee Returns
“They've got these returns, 66% a year before fees. Only 39% after fees, yeah, after their five and 44 fees.”
Renaissance Has Generated Over $100 Billion in Lifetime Trading Profits
“If you add it all up, it's over a hundred billion dollars over the course of their lives, seven billion a year before everything.”
John Paulson Made $20 Billion Across 2007 and 2008
“Yeah, he made twenty billion dollars over 2007 and 2008”
Early Simons-Baum Algorithm Cornered the Maine Potato Market
“And they developed the system, an automated type system, early trading model, and it cornered the market for Maine potatoes.”
Jim Simons Hired Alan Greenspan as an Early Consultant
“He hired this young economist as a consultant named Alan Greenspan, and he had his red phone that went off when news broke and they would try to beat everybody else in trading kind of thing.”
Jim Simons Gave Renaissance Team a Six-Month Ultimatum on Equities
“Simon's almost pulled the plug. He gave his guys six months, and he goes, guys, that's it. We're gonna pull the plug. I'll give you six more months.”
Renaissance Holds 4,000 to 5,000 Long and Short Equity Positions
“So today, and it's not so dissimilar from what it was back then, today it's about four or 5000 stocks that are long, four or 5000 stocks that are short.”
Medallion Fund Has Been Employee-Only Since Around 2003
“Medallion has been really only Jim Simons and his employees since around 2003. They kicked the last people out.”
Roughly 100 of Renaissance's 300 Employees Hold PhDs
“What I mean by that is they're not just PhDs, and yet they have a hundred out of like 300 people there, their PhDs. These are people that are groundbreaking scientists, physicists, astronomers.”
Quantitative Traders Account for 31% of Market Trading
“So, 31% of quant trading today is from quantitative traders, and it's almost like the dumb money has left the table, the poker table, and you're going up against the sophisticated guys.”