Jim Simons’ Medallion Fund is a phenomenon, by far the best hedge fund with 34% annual alpha. The problem is its strategy has a size constraint. So Jim Simons has had to return outsiders’ capital. Simons is making at least a couple of billions of dollars every year from his investments in the Medallion Fund.
In 2005, Simons launched Renaissance Institutional Equities Fund (RIEF) for outside investors with the goal of managing tens of billions of dollars. The fund was said to have a theoretical capacity of $100 Billion. It was expected to beat the S&P 500 index by 4 to 6 percentage points per year on the average. Through September 2007, RIEF had an annualized return of 12.8% and $28 Billion under management. In 2008, RIEF lost 16% followed by a 6% loss in 2009. RIEF’s return was in line with S&P 500 in 2010, returning 16.5%.
Jim Simons’ 2011 performance is spectacular. His top stock picks managed to beat the market by nearly 10 percentage points since March. Most of those stocks are still in his portfolio. Four new stock picks managed to break into Simons’ top 30 holdings: Procter & Gamble (PG), JP Morgan (JPM), Novartis (NVS), and Verizon (VZ). Here are his top 30 stock picks and recent portfolio activity: