291–300 of 338 posts
I went to a Simons Foundation lecture in like 2014. The topic and speaker escapes me now, but at the reception beforehand there there was an old man smoking. At the time I indulged myself so I asked the guy that invited me if I could smoke there too. He said, "only Jim can smoke in here." And that's the first time I had any idea who Jim Simons was.
"My algorithm has always been: You put smart people together, you give them a lot of freedom, create an atmosphere where everyone talks to everyone else. They're not hiding in the corner with their own little thing. They talk to everybody else. And you provide the best infrastructure. The best computers and so on that people can work with and make everyone partners"
if only more companies fostered the idea of employee wellbeing
In fact, standard economic theory would say that it is better to pay people more instead doing anything else.
Earlier quoted context omitted.
His whole RenTech story was fascinating. Effectively an outsider in finance who gathered a bunch of other outsiders (aka big mathematicians), and decided to start a hedge fund that takes zero interest in the actual companies and trades solely on math. Which makes sense, since none of the main people involved in its creation had any corporate or finance experience, but tons of math experience and knowledge. This is ov…
Does the book cover anything about how the fund actually works? It's understandable that they'd want to keep a tight lid on it, but I'm so curious
Earlier quoted context omitted.
Their returns worked out to something like an average of 39% per year after fees, which is the figure I've heard cited. This may be what they were thinking of. Renaissance was/is known for having higher fees than likely the entirety of their competition, which they can get away with since their returns still outstrip the rest after the higher fees.
The fund is closed off to outsiders, so the fees are don't matter in the same way they do for most funds. In the podcast episode on Rentec done by Acquired, the hosts speculated that rentec kept the high fees as a way to ensure they have enough to handsomely pay less tenured employees who don't yet have much money in the fund.
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Well it’s an algo trading company.
Please explain why quantitative algo (not HFT) trading is “bad”?
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Mathematics can only take you so far. At the end of the day, people run the exchanges. Not math. The returns of modern HFT market makers are even higher. With their unfair “business” advantages such as PFOF, privileged dark pool and block trade access, and military internet infrastructure. Think 60%+, per year, at least. Over 10-20 years, of course.
> The returns of modern HFT market makers are even higher. The returns of a child's lemonade stand are even higher... Market makers and lemonade stands are mostly about paying for labour (and ideas etc, but let's call that 'labour', too). Capital requirements are rather low. So taking all the profit and attributing it to capital returns tends to give you weird numbers.
Why does it matter? Returns are returns. Money in, money out.
After all, people compare HYSA bank interest with TreasuryDirect bond returns with equity ETFs like VTI and QQQ. Each with vastly different capital mechanics.
Earlier quoted context omitted.
His whole RenTech story was fascinating. Effectively an outsider in finance who gathered a bunch of other outsiders (aka big mathematicians), and decided to start a hedge fund that takes zero interest in the actual companies and trades solely on math. Which makes sense, since none of the main people involved in its creation had any corporate or finance experience, but tons of math experience and knowledge. This is ov…
Does the book cover anything about how the fund actually works? It's understandable that they'd want to keep a tight lid on it, but I'm so curious
Basically, no.