Jim Simons

Last week Jim Simons one of the greatest quant traders ever to have walked the planet sadly died aged 86.

Which, is a pretty good innings considering he was a heavy chain smoker, (he definitely got the better end of that negative expectancy trade!)

Rumour has it, that he would insist on smoking inside buildings and just pay the fine.

He even spent $30k on a special air filtration unit just so he could smoke in his board room.

And… smoked a pack of cigs in front of the American Cancer Society (they were an investor in his fund.)

So you could say he made his own rules…

Well, he certainly did when it came to trading.

Coming from a maths background, Simons was all too aware of the emotions and biases that plague investors.

He left academia in 1978 aged 40, and in 1982 he decided to use his mathematics skills to start a company Renaissance Technologies.

A trading firm focused exclusively on trading using quantitative models.

His goal was to remove emotion and focus on pure hard data.

Well, that bet paid off…and he formed a fund called the Medallion Fund.

From 1988 until 2021 that fund made an average of 66% per year... (Yes that’s not a typo… 66%)

Some other fun facts:

1. From 2001 – 2013 the fund’s worst year was +21%
2. In 2008 the fund made 98.2% when the S&P lost 38.5%
3. Hedge funds usually charge a 20% performance fee, Simons charged 44% 
4. He pulled over $100 billion of profit from the markets
5. No other money manager comes close to Simons in terms of returns
6. Medallion was closed to outside money in 1993
7. The fund was capped at $10bln as it couldn’t manage more with the strategy
8. He would often walk around the office barefoot
9. Simons was a codebreaker for the government at the height of the Cold War

This man certainly left his mark on the world…

Oh and here’s something to remember.

A tweet from Gregory Zuckerman who wrote the book. “The Man Who Solved The Markets” all about Jim Simons.