Jim Simons' RenTech fund has fielded over $5 billion of client withdrawals in under 10 weeks, report says

Advertisement
Jim Simons' RenTech fund has fielded over $5 billion of client withdrawals in under 10 weeks, report says
Renaissance Technologies founder and former chairman Jim Simons.AP Images / Jason Decrow

  • Renaissance Technologies has fielded over $5 billion in withdrawal requests in less than 10 weeks.
  • Jim Simons' quantitative hedge fund posted double-digit losses in its three public funds in 2020.
  • However, RenTech's flagship Medallion fund gained 76% last year.
  • Visit Business Insider's homepage for more stories.

Jim Simons' Renaissance Technologies has been hit by more than $5 billion in redemptions since December 1, Bloomberg reported on Monday.

Simons, a former NSA codebreaker and MIT math professor, founded RenTech in 1982. The firm is now the world's largest quantitative hedge fund with about $60 billion in client assets, and boasts one of the best track records on Wall Street.

Advertisement

Yet its clients withdrew a net $1.85 billion from its three public funds in December. They also asked to withdraw another $1.9 billion in January, and have requested $1.65 billion so far this month, Bloomberg said.

Read More: Wall Street's resident IPO expert shares the strategy behind her ETF that returned 107% last year - plus 3 risks to the current IPO boom and 5 offerings to watch this year

RenTech's investors are pulling their money after the firm's international equities fund lost 19% in 2020, its institutional diversified alpha fund tumbled 32% over the same period, and its institutional diversified global equities fund slumped 31%.

Advertisement

The trio stomached those losses because they were underhedged when the pandemic tanked markets last spring, and overhedged when asset prices rebounded in the second quarter, RenTech told its clients in December.

Simons and his team bemoaned the "terrible" performance, but said that even the best investments occasionally perform "horribly," Bloomberg said.

Read More: Goldman Sachs says the reflation trade is on and these 5 market dynamics that could 'shift materially' as price pressures build

Advertisement

In contrast, the firm's flagship Medallion fund - which is only open to owners, employees, and their families - gained 76% last year, Institutional Investor reported last month. It has delivered average annual returns of about 40% since its launch in 1988.

Simons stepped down as RenTech's chairman last month, but continues to serve as a board member.

{{}}