Renaissance Technologies Explained

Last year its Renaissance Institutional Futures Fund (RIFF) lost 3.17 %, versus a obtain of just 1.84 percent in 2011. 3 of the hedge funds top six largest holdings have paid steady or rising dividends for 25 or far more consecutive years: Colgate-Palmolive (CL), Hershey (HSY), and Becton, Dickinson & business (BDX). Renaissance sought to convert profit from Medallion’s fast trading into long-term capital gains, stated the individuals, who spoke on situation of anonymity because the dispute hasn’t been produced public. People are obtaining paid extraordinary amounts of cash for functionality that is mundane and extremely average.

Bloomberg : James H. Simons, who became a billionaire when he turned his extraordinary mathematical ability from defense perform to investing, has deployed an unusual method at Renaissance Technologies LLC to skirt hundreds of millions of dollars in taxes for himself and other investors, stated folks with expertise of the matter. It is demanding far more tax payments from investors in Renaissance’s $10 billion Medallion fund, the folks stated.

The best federal rate on long-term gains is about half that on quick-term.. As described in the memo and by men and women with knowledge of the matter, the transaction worked as follows: Barclays bought a portfolio of stocks and other instruments that fund managers at Renaissance wanted to trade. ESL’s prospects now rely upon the health of mass-marketplace retailer Sears Holdings Corp.

Medallion could claim it owned just one particular asset – the alternative – which it held for more than a year, enabling any obtain to be treated as long-term” when its investors reported the revenue on their personal tax returns. Last year the veteran Long Island hedge fund manager’s quant-driven Medallion hedge fund returned 29.5 % net. That was all the more exceptional offered the US$five.three billion fund’s five percent management charge and 44 % efficiency charge. Many hedge funds are run by teams of pointy-headed rocket scientists, but Renaissance Technologies Corp.

The firm’s new US$three.four billion Renaissance Institutional Equity Fund, which Simons says in an investor document has the capacity to deal with as a lot as US$one hundred billion in assets, got off to a slow start off last year, rising just 5 % from its August 1 inception by way of year-finish. RIEF’s gain in assets came as Simons moved Medallion ever closer to getting a closed portfolio for himself, his close friends and his employees.