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Renaissance Technologies Review

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Renaissance Technologies, LLC

Renaissance Technologies, LLC is a large hedge fund manager located in New York. It manages a little over $165 billion in client assets across 18 different pooled investment vehicles, many of which are hedge funds. It employs a staff of around 300 employees, 150 of which perform investment advisory functions at the company.

Renaissance is one of the most successful hedge funds in the world, famous for its Medallion fund, which has one of the best investing records in history. The firm uses incredibly sophisticated mathematical analysis to drive performance in their funds. However, not everyone can invest in a hedge fund or have access to cutting edge mathematic trading solutions. That's where a financial advisor can help you, and SmartAsset's free matching tool can connect you with local advisors today.

Renaissance Technologies Background

Renaissance Technologies was founded nearly 40 years ago in 1982. James Simons and Howard Morgan started the firm together. Both are considered some of the most successful hedge fund managers in the world. Simons himself is partiuclalry decorated and is extremely involved with several philanthropic ventures. Peter Brown is the company's current CEO.

Renaissance is owned by Renaissance Technologies Holdings Corporation (82% stake) and RTC II Holdings, LLC (18% stake). Each of these parent companies is owned by firm employees or other related people. The firm is headquartered on Long Island, but its business address is located in Manhattan, New York.

Renaissance, through its funds, works with a variety of clients, the majority of which are institutional. These include its pooled investment vehicles, as well as businesses and banks.

Renaissance Technologies Investment Philosophy

The investment philosophies at Renaissance Technologies are extremely math-based, and these mathematical strategies are kept quite secretive. Many believe this has undoubtedly contributed to the firm's overwhelming success, though. The firm uses its quantitative analysis methods to uncover technical indicators with predictive value. It then creates computer models that help drive financial success through speculative trading. The firm's most popular and successful fund, the Medallion fund, uses both security-related and future-related instruments, and its other funds operate similarly.

When it comes to specific investments, the firm trades global equity securities that are available to be traded on U.S. exchanges. It focuses both on long-term time horizons and short-term trading mechanisims. Specific decisions depend on the fund, strategy, economic landscape and other factors. 

Renaissance Technologies makes it clear to investors in its funds that investments tend to be speculative, volatile and risky. They are only deisgned for investors who can handle a significant degree of risk. Additionally, fund investors aren't kept privy to the investment decisions made in funds. They also do not participate in management decisions.

Largest Hedge Funds Managed by Renaissance Technologies

REIF Trading, LLC

  • AUM: $56,220,345,094
  • Minimum: $1,000
  • Beneficial Owners: 2,080

GF Trading, LLC

  • AUM: $31,823,492,840
  • Minimum: $1,000
  • Beneficial Owners: 842

Ridge Master Trading, LP

  • AUM: $26,397,633,107
  • Minimum: $1,000
  • Beneficial Owners: 708

Medallion Holdings, LLC

  • AUM: $19,556,032,950
  • Minimum: $0
  • Beneficial Owners: 0

Medallion Fund, LP

  • AUM: $4,068,694,629
  • Minimum: $10,000
  • Beneficial Owners: 341

Fees at Renaissance Technologies

Renaissance Technologies charges fees to its funds based on a percentage of each fund's assets under management. Typically, these fees are charged on an annual basis. Fees may be charged in arrears semi-annually or upon redemption.

Medallion Funds
Management Fees Performance Allocation
0% - 5% of value of capital account 0% - 44% of net profits

 

REIF Funds
Management Fees Performance Allocation
0% - 1.50% of net asset value  0% - 10% of net capital appreciation

 

RIDA Funds
Management Fees Performance Allocation
0% - 1% of net asset value  0% - 10% of net capital appreciation

 

RIDGE Funds
Management Fees Performance Allocation
0% - 1% of net asset value  0% - 10% of net capital appreciation

Some funds charge performance-based fees, while others do not. It's important to make sure you understand the specific fund's fee schedule before investing in it. Other funds have fee schedules that are not listed publically, so you may have to contact the firm for more information.

What to Watch Out For

According to SEC rules, only accredited investors can invest in a hedge fund. More specifically, an accredited investor must have at least $200,000 of earned income ($300,000 for couples) in each of the past two years, as well as a reasonable assumption that the same will happen the current year. You're also considered an accredited investor if you have at least a $1 million net worth (minus the value of your primary residence) either on your own or together with a spouse.

Renaissance Technologies has five disclosures listed on its Form ADV, and four of them are regulatory in nature, while one is a civil judicial disclosure. Three of these disclosures relate to advisory affiliates of the firm, whereas the other two are attributed to the firm directly. Each disclosure culminated in its own sanctions.

Becoming a Client Of Renaissance Technologies

If you want to work with Renaissance Technologies through its hedge funds, you'll need to be an accredited investor. Even then, it can be difficult to figure out how to get involved as an investor in one of its funds. You can visit the firm's website to find its mailing and physical addresses. You can also call (212) 829-4460 if you'd like to work over the phone.

Investing Tips

  • Whether you're interested in a hedge fund or just small-time stock trading, it can help to have a long-term plan. Luckily, finding a financial advisor who can help you doesn’t have to be hard. SmartAsset’s free tool matches you with financial advisors in your area in just five minutes. Get started now.
  • If you're determined to get started investing on your own, it's important to be as prepared as possible. For starters, check out our free investment calculator.

How Long $1mm Lasts in Retirement

SmartAsset's interactive map highlights places where $1 million will last the longest in retirement. Zoom between states and the national map to see the top spots in each region. Also, scroll over any city to learn about the cost of living in retirement for that location.

Least
Most
Rank City Housing Expenses Food Expenses Healthcare Expenses Utilities Expenses Transportation Expenses

Methodology We analyzed data on average expenditures for seniors, cost of living and investment returns to determine how many years of retirement a $1 million nest egg would cover in cities across America.

First, we looked at data from the Bureau of Labor Statistics (BLS) on the average annual expenditures of seniors. We then applied cost of living data from the Council for Community and Economic Research to adjust those national average spending levels based on the costs of each expense category (housing, food, healthcare, utilities, transportation and other) in each city. Using this data, SmartAsset calculated the average cost of living for retirees in the largest U.S. cities.

We assumed the $1 million would grow at a real return (interest minus inflation) of 2%. Then, we divided $1 million by the sum of each of those annual numbers to determine how long $1 million would cover retirement expenses in each of the cities in our study. Cities where $1 million lasted the longest ranked the highest in the study.

Sources: Bureau of Labor Statistics (BLS), Council for Community and Economic Research