Jim Simons attends the IAS Einstein Gala at Pier 60 Chelsea Piers in New York City.
Sylvain Gaboury | Patrick McMullan | Getty Images
Jim Simons, the mathematician who founded the most successful quantitative hedge fund of all time, died Friday in New York, his fund announced on its website.
Innovation mathematical models and algorithms for making investment decisionsSimons left behind a track record at Renaissance Technologies that rivaled legends like Warren Buffett and George Soros. His flagship fund, Medallion, had an annual return of 66% between 1988 and 2018, according to Gregory Zuckerman’s book.The Man Who Decided the Market“
During the Vietnam War, he worked as a codebreaker for American intelligence, spied on the Soviet Union, and successfully broke the Russian code.
Simons received a bachelor’s degree in mathematics from the Massachusetts Institute of Technology in 1958 and a doctorate in mathematics from the University of California, Berkeley, at the age of 23. The quantum guru founded what would become the Renaissance in 1978, at the age of 40. after he dropped out of the academy and decided to try his hand at trading.
Unlike most investors, who looked at fundamentals such as sales, earnings and profit margins to assess a company’s value, Simons relied entirely on an automated trading system to take advantage of market inefficiencies and trading patterns.
“I don’t have an opinion on any stock… The computer has an opinion and we follow it slavishly,” Simons told CNBC in 2016.
His Medallion fund earned more than $100 billion in trading profits between 1988 and 2018, with an annual return of 39% after fees. The fund was closed to new money in 1993, and Simons only allowed his employees to invest in it starting in 2005.
Quantitative strategies based on trend-following models have gained popularity on Wall Street since Simons revolutionized trading starting in the 1980s. JPMorgan estimates that quant funds now make up more than 20% of all equity assets.
At the time of his death, Simons was worth an estimated $31.4 billion, according to Forbes.
The quantum physics guru previously headed the mathematics department at Stony Brook University in New York, and his mathematical discoveries play important roles in fields such as string theory, topology and condensed matter physics, his foundation says.
Simons and his wife founded Simons Foundation in 1994 and have donated billions of dollars to charities, including supporting mathematics and scientific research.
He took an active part in the work of the foundation until the end of his life. Simons is survived by his wife, three children, five grandchildren and a great-grandchild.