Renaissance Technologies and Jim Simons’ New Bullish Bets

Renaissance Technologies is Jim Simons’ cash cow. RenTech’s quantitative investment strategies made Jim Simons one of the world’s richest men. Simons founded Renaissance Technologies in 1982. Since then, he  has grown it one of the world’s largest hedge funds (according to Bloomberg) and has produced such consistently high returns managing the over $25 billion fund that he has been able to charge the one of the highest fees in the industry, and get away with it. Simons stepped down from managing Renaissance Technologies in October 2009, but the strategy he laid down still holds true.

RENAISSANCE TECHNOLOGIES

Jim Simons is a theoretical mathematician. As such, his strategy has always been to focus on quantitative data. In other words, he used statistical and mathematical analysis to make decisions about how to invest his fund, applying this information to exploit even the smallest market inefficiencies. As such, Simons has an incredibly expansive portfolio, often managing thousands of positions at once.

While this strategy has historically worked to the benefit of Renaissance Technologies, either the glow seems to be fading or Simons’s smaller positions plays a larger role than his larger positions. Since the end of June, Renaissance Technologies’ new stock picks have underperformed the S&P 500 (SPY), returning a loss of 9% vs. a 8% loss for the SPY over the same period.

Renaissance Technologies Portfolio:

Renaissance Technologies Jim Simons

Of the stocks Simons is most bullish about, the greatest losses were in Jupiter Networks Inc (JNPR); Renaissance Technologies lost 34% on that position since the end of last quarter. The $35.5 million position is a new position for Renaissance Technologies and popular with other funds. John Burbank’s Passport Capital bought a position worth nearly $40 million last quarter (check out Burbank’s top picks) while Brookside Capital went in with a position worth nearly $300 million (see what Brookside is up to). Renaissance Technologies also lost big on Level 3 Communications Inc (LVLT), losing 33% since the end of June.

There were some successes though. Renaissance Technologies gained 23% on Green Mountain Coffee Roasters (GMCR). Green Mountain is a new position for Renaissance Technologies; they initiated a $48.9 million position last quarter. Popular opinion is rather divided amongst the hedge funds we track. Steve Cohen of SAC Capital Advisors decreased his position in the coffee company by 40% last quarter, bringing his position to $97 million (check out Cohen’s top picks). In contrast, Discovery Capital Management’s Rob Citrone increased his position in the company by 374% last quarter, bringing it to a value over $100 million (see Citrone’s top picks). Given the relative success of Green Mountain since the end of June, it seems Simons and Citrone were right about it.

We like Jim Simons and he certainly has a strong performance record, strong enough that his moves are even emulated by the top hedge fund managers in the industry. However, for the private investor, mirroring Renaissance Technologies successfully will require holding more positions than average, acting quickly to exploit market inefficiencies and finding a way to make profits while affording the transaction costs.

blog comments powered by Disqus
Insider Monkey Headlines
Insider Monkey Small Cap Strategy
Insider Monkey Small Cap Strategy

Insider Monkey beat the market by 52 percentage points in 24 months Click to see monthly returns in table format!

Lists

7 Most Expensive Cities in the World

5 Least Expensive Cities in the World

10 Celebrities Who Believe In Scientology

10 High Margin Food Products to Build a Business Around

The 10 Most Expensive Clothing Stores in the United States to Get Decked Out At

The 5 Biggest Kickstarter Scams That Swindled Backers’ Donations

The 10 Most Expensive Boarding Schools In the World

50 Crazy Facts About Japan You Won’t Believe

Top 10 Least Expensive Hybrid Cars to Save the Planet With

The 10 Biggest ‘Gate’ Controversies in History

The 10 States with the Highest Nursing Shortages Leaving Their Hospitals Depleted

The 10 Best Value Investment Blogs that Every Investor Must Read

The 6 Cheapest Boarding Schools in Europe 2015

The 5 Most Expensive Cars To Insure in the World

The 10 Most Common Genetically Modified Foods

10 Self-Made Billionaires Who Came From Nothing

The 10 Most Expensive Cities to Live in North America

The 13 Most Expensive Headphones in the World to Represent

The Top 20 Wealthiest Soccer Teams in 2014

4 BuzzWorthy Cannabis Stocks And Some Smoking Derivative Plays

The 10 Healthiest Fast Food Chains in America to Dine At

The 5 Most Expensive Cat Food Brands You Can Spoil Your Kitty With

The 6 Best eCommerce Platforms for Small Businesses

The 10 Worst Mistakes an Entrepreneur Can Make

The 5 Most OP Characters in League of Legends to Carry Games and Crush Foes With

The 5 Best Foods to Eat Before Running that Will Help You Pound the Pavement

10 Glaring Plot Holes in The Walking Dead that a Zombie-Filled Bus Could Drive Through

The 5 Biggest Celebrity Stoners Who Love Their Reefer

The 10 Most Overrated Movies Of All Time by Out-of-Touch Critics

Top 6 Least Expensive Cruise Destinations For 2015 that Will Take You to Paradise

10 States with Lowest Substance Abuse Rates in America

The 14 Most Watched TV Finales Ever

The 10 Best Selling Role Playing Games of All Time for PC

10 Most Influential Papers In Economics

Top 8 Biggest Charities in the US

10 Worst Celebrity Career Moves Ever

Top 10 Best Paid Tennis Stars in the World

Top 6 Cities For The Ultra Rich to Live in Comfort

10 Cities with High Demand for Nurses

6 of the Worst Greeting Card Messages Ever Crafted

How to Make Money in ArcheAge and Build Your Empire

10 Foods To Eat To Lower Cholesterol Levels

The 10 Most Hated Television Characters of All Time

The 30 Worst Halloween Costume Ideas Ever Brought to Horrible Life

10 Vocational Skills in Demand Today with Jobs Waiting to be Filled

10 Best Places to Visit in Central and South America

The 10 Greatest Empires in History Which Nearly Conquered the World

The 6 Cheapest Boarding Schools In America 2015

5 Clear Reasons LoL is Better than DotA, Continues to Rule MOBAs

The Only 9 Teams with a Chance to Win the Super Bowl

Subscribe

Enter your email:

Delivered by FeedBurner

X

Thanks! An email with instructions is sent to !

Your email already exists in our database. Click here to go to your subscriptions

Insider Monkey returned 47.6% in its first year! Wondering How?

Download a complete edition of our newsletter for free!