Below are the 5 biggest quant funds in the world. For a comprehensive list please see 10 Biggest Quant Funds in the World.
Quant pioneer Renaissance Technologies saw one of the biggest losses in its history from its three funds open to outside investors. Renaissance Institutional Diversified Alpha fund and Renaissance Institutional Diversified Global Equities fund fell in the range of 30% in 2020 while its Institutional Equities fund plunged close to 20%.
Its Medallion Fund, which is available only to Renaissance insiders, returned 76% last year.
Renaissance Technologies remained unsuccessful in accurately predicting market trends during the first half of the year, but the firm managed to trim losses during the second half of the year. In a September quarter letter to investors, Jim Simons said its losses were due to being under-hedged during March’s collapse and then over-hedged in the rebound from April through June. That happened because its trading models “overcompensated” for the original trouble.
Quant pioneer Renaissance Technologies, which manages $116 billion of assets under management and its 13F portfolio value stood above $100 billion at the end of the September quarter, seeks to diversify investments across several sectors. Zoom Video Communications (NASDAQ: ZM) is the largest stock holding of the computer-powered hedge fund.
Artisan Global Discovery Fund, which posted a return of 11.79% for the 3rd quarter of 2020, highlighted few stocks including Zoom Video in an investor’s letter. Here’s what Artisan Global Discovery Fund stated:
“Zoom’s enormous growth so far this year was on full display in Q2: 458% YoY growth in new customers (companies with >10 employees), 355% YoY revenue growth and a more than doubling in operating margins to 42%. Notable new customers included Exxon Mobil, Activision Blizzard and Service Now. While Zoom will not sustain this extreme rate of growth much longer—we and the company expect elevated customer churn on the other side of the pandemic—there are many potential long-lasting behavioral changes from this crisis that rely on videoconferencing (telehealth, less business travel, online education, etc.). Furthermore, Zoom’s customer base (15 million) still represents a small fraction of the total addressable market for video conferencing (400 million), and the company is in the early days of cross-selling additional products and services (Zoom Phone, Zoom Chat, Zoom Rooms) into its large customer base. However, given the massive YTD run and shares approaching our estimate of PMV, we pared our exposure during the quarter.”