Firm: Renaissance Technologies
City: East Setauket, New York
2008 Age: 69
2008 Assets Under Management: 30+ Billion
James Harris “Jim” Simons received his bachelor’s degree in mathematics from the Massachusetts Institute of Technology (MIT) in 1958, and his PhD, also in mathematics, from the University of California, Berkeley in 1962 at the age of 23. While at MIT he studied under renowned mathematicians Warren Ambrose and I.M. Singer.
From 1961 to 1964, he taught mathematics at MIT and Harvard University. Between 1964 and 1968, he was on the research staff of the Communications Research Division of the Institute for Defense Analyses (IDA).
In 1968, he was appointed chairman of the math department at the Stony Brook University. Jim Simons is involved the discovery and application of certain geometric measurements, resulting in the Chern-Simons theory.
In 1978, he left academia to run an investment fund that traded in commodities and financial instruments on a discretionary basis.
Simons founded Renaissance Technologies Corporation in 1982. As a hedge fund manager Simons’ exploits market inefficiencies using complex computer-based mathematical models. These models are based on analyzing as much data as can be gathered, then looking for non-random movements to forecast future price movement.
The firm’s latest fund, the Renaissance Institutional Equities Fund (RIEF), is designed to handle upwards of $100 billion. The more well-known Medallion fund is a separate fund of the personal money of the firm’s executives only.
Simons charges a higher than average management fee of 5 percent of assets, in addition to 20 percent of profits. He achieved a ten-year Sharpe ratio of 1.89 throughout the 1990s, with a 2.52 ratio for the last five years of the decade.
Practitioners in the fields of astrophysics, number theory, computer science and computational linguistics are among the staff at Renaissance. There are notably few Wall Street veterans and MBA’s at the firm.
An active philanthropist Simons has used his fortune to support math teachers, the study of autism and health care in Nepal.
Simons is the father of five and lives with his wife in Manhattan and Long Island.