<story><title>Jim Simons proved the textbooks wrong, almost</title><url>https://www.bloomberg.com/opinion/articles/2021-01-16/investing-legend-james-simons-s-record-won-t-be-beat</url></story><parent_chain></parent_chain><comment><author>probe</author><text>I’ve found RenTech to be fascinating over the years and highly recommend the book on it “Man who solved the market”&lt;p&gt;Two big takeaways for his success -&lt;p&gt;1) He was pretty early, and quite contrarian, in betting on computer and quant strategies and thus took the “low hanging fruit” early on (def wasn’t low hanging back then when no one knew or believed in computer trades strategies)&lt;p&gt;2) From the book, Rentech’s main strategy was based on “reversion to the mean” - I.e “We make money from the reactions people have to price moves”. Trading on how you think OTHERS will trade and systemizing it (ex vol and momentum) is powerful but clearly doesn’t scale when you become the market yourself&lt;p&gt;And a bonus one - despite being a math genius, he basically was failing till he brought on others. He hired the right people (ie those interested in math not finance), created the right environment, took care of logistics, and pushed on a key insight (model to trade). He couldn’t have done it by himself.</text></comment>
<story><title>Jim Simons proved the textbooks wrong, almost</title><url>https://www.bloomberg.com/opinion/articles/2021-01-16/investing-legend-james-simons-s-record-won-t-be-beat</url></story><parent_chain></parent_chain><comment><author>nabla9</author><text>Pretty good article. It explains almost everything that is known about Medallion fund_&lt;p&gt;1. Very research oriented&lt;p&gt;2. Their strategy  does not scale. Fund has limited size.&lt;p&gt;3. They use some kind of arbitrage. No high-frequency trading, but longer.&lt;p&gt;4. Their current strategy  must be kept secret for it to make money and it changes over time.&lt;p&gt;This is why &amp;quot;I have discovered fool proof way to beat the market&amp;quot; sales pitch is always a hoax. If someone has it, they keep it secret and make money. If everyone has  it, it has no value.</text></comment>