Here is a link to the book recently written about Jim Simons and RenTech
https://www.goodreads.com/book/show/43889703-the-man-who-sol...
Renaissance Technologies
111–120 of 261 posts
Re: Renaissance Technologies
#112The tone of many comments here is disappointing. I'm really surprised at the number of people suggesting illegal activity. Why is it so hard to accept that someone did the math?
I should add that Renaissance Technologies is hiring! https://www.rentec.com/Careers.action My group is looking for very strong Java/Kotlin developers.
I know this is not likely, but you should consider setting up an anonymous email in your HN profile to at least receive questions about the company as an employee. Not to answer anything proprietary or to give anything away under NDA, but so that people can speak candidly with someone not in HR without having to rely on HN comments.
Denise is great, but I wouldn't say she's the best source to answer harmless but very important questions prospective Java programmers might have that you can answer, for example :)
Here's an example question for you: do you want candidates to also have tax and accounting experience, or is deep Java/Kotlin enough?
Something to consider.
Re: Renaissance Technologies
#113Earlier quoted context omitted.
There would be no disbursements from one fund to the other. Fund A would purchase an asset slowly over time. When it has finished purchasing the asset, fund B would purchase that asset quickly at a scale large enough to increase the market price of it. As the price rose, fund A would sell its position. The net effect is that fund A sees increased returns and fund B sees decreased returns.
This is throwing any efficient-market hypothesis out the window. Msybe this would work for a year, but why would anyone invest in fund B if it is a consistent loser. If you can figure out a way to slowly buy an asset and then quickly buy more of it and make both strategies profitable at all, then you're onto something huge. Almost as huge as Ren Tech
It assumes an efficient-market. The money is coming at the expense of fund B. It doesn't need to be a consistent loser, it just needs to make less than it otherwise would on average.
People invest in funds that under perform the market all the time. That describes the majority of the finance industry.
Re: Renaissance Technologies
#114Earlier quoted context omitted.
Uh, if all it took to beat the market was consistently rebalancing your portfolio everyone would be doing it. It takes more than that to consistently beat the market.
A lot of money managers are doing that. It's a tiny percentage, something like 2%. The reason that it isn't as common is because the time table is like 15-20 years, not 3-5.
If you beat the market for 3-5 years, that's not consistently beating the market. That's flipping a coin.
That's 100 people flipping coins, and being impressed that someone got 4 heads - all in a row.
Re: Renaissance Technologies
#115Jim Simons and David E. Shaw are legends who should have some HBO series about them. Both were researchers who left academia to beat the scumbags of wall streets in their own game with no finance background and they made unbelievably so much money in a very short of time that they would have been jailed or killed if they weren't in the US.
I have seen more scumbags in academia than i have in WS btw.
Re: Renaissance Technologies
#116A great book about RenTec and Jim Simons came out recently: The Man Who Solved the Market: How Jim Simons Launched the Quant Revolution. Everyone in the industry worships Simons and RenTec as practically god-like. What they've managed to do shouldn't really be possible and is out of this world. According to Wikipedia over a 20 year period between 1994 and 2014, RenTec realized an 71.9% annualized return in their inte…
My own suspicion is that they have access to some raw information that others don't have. An example of such information would be information gathered from insiders at other corporations or industrial espionage. It's more likely, in my view, that they've created a world-class industrial espionage outfit than that they've "solved the market" for decades where virtually everyone else has failed. On the other hand, if t…
I guess all the math and science PhDs they hire are actually undercover spies that finished their dissertations in order to provide a good cover?
Re: Renaissance Technologies
#117Earlier quoted context omitted.
I mean what is the end effect of this though? Basically some smart people get very rich. Due to zero-sum game, other people lose. No benefit is derived in the real economy. The only possible benefit is increased liquidity... which really isn't that beneficial past a point right? I don't see the benefit. If you have a different angle I'd be glad to hear it.
> Due to zero-sum game Wealth is not zero-sum, it's created. Real GDP (i.e. adjusted for inflation) in the world has increased from ~$3.4T to ~$110T since the 1900s.
The parent comment is talking about hedge funds. It does not seem likely that they are responsible for the increase you are talking about.
Re: Renaissance Technologies
#118Earlier quoted context omitted.
> Due to zero-sum game Wealth is not zero-sum, it's created. Real GDP (i.e. adjusted for inflation) in the world has increased from ~$3.4T to ~$110T since the 1900s.
Yeah, but what does that have to do with trading? When you create something that physically benefits people/the world, you usually extract your own value (profit) by providing even more value and selling it. When you trade like this, what net value are you providing? It seems like they are just extracting value. Also, if all the smart minds were doing advanced trading in 1900, would the GDP have risen as much? Instea…
Agreed. And as you mentioned above, many believe the “real value” or whatever of liquidity is indeed capped and has diminishing returns. Trading financial instruments doesn’t just perform the capital allocation task that we were told it does in Econ 101. It’s also a fantastic way to take other peoples money. Why is that so hard to believe? And to those feeling a need to deny such behavior as an attack on capitalism, I’d suggest that it’s the purest expression of capitalism. The goal of investors or capitalists isn’t to do anything useful other than acquire more money. To the extent useful stuff happens, that’s just a side effect of acquiring more money. There’s no altruism involved. So it should be something that a true capitalist would embrace.
Re: Renaissance Technologies
#119Note that RenTec also runs two other funds that are larger than the Medallion Fund, but both under perform the index. On a completely unrelated note, if I were interested in creating a fund that appeared to have market beating returns for decades and I wasn't concerned about the legal consequences, here's one way I might do it: I would create fund A and B and seed them with some initial capital. For fund A, I would c…
To be frank, running this sham for 30 years sounds less plausible to me than beating the market the boring way. How would you stop investors in your two public funds (and their accountants) from asking pointed questions about disbursements from one fund to the others? Do you plan to fool them for this amount of time, or bring them into the conspiracy? And how will you sustain the conspiracy when your other two funds…
> running this sham for 30 years sounds less plausible to me than beating the market the boring way.
I agree that a sham seems unlikely. But to this specific point, didn‘t Madoff‘s scheme run for several decades? Wasn‘t he even made NASDAQ chairman or sth at some point?
I think multi-decade frauds are definitely possible.
My own pet conspiracy theory about Rentec is rather that Simons was a cryptographer so maybe there was/is some actual hacking involved at some point in the pipeline. I say this, of course, with zero nonpublic information and on the basis of nothing. The stated numbers are just so incredible, it boggles my small mind
Re: Renaissance Technologies
#120Earlier quoted context omitted.
I should add that Renaissance Technologies is hiring! https://www.rentec.com/Careers.action My group is looking for very strong Java/Kotlin developers.
I know this is not likely, but you should consider setting up an anonymous email in your HN profile to at least receive questions about the company as an employee. Not to answer anything proprietary or to give anything away under NDA, but so that people can speak candidly with someone not in HR without having to rely on HN comments. Denise is great, but I wouldn't say she's the best source to answer harmless but very…
It's a small world. Denise used to sit outside my office until I moved moved to a new location. ;-)
She has forwarded requests that people may occasionally send directly to me in the past and I generally try to respond. I prefer all communication be done through proper channels to avoid any "issues" that might arise.
I have a son who is a CS major in college now. I completely understand how challenging (and borked) the hiring/interviewing process is now as I speak with him about the frustrations he experiences. Which is why I try to be approachable when people have queries.