Hedge fund manager Jim Simons was the first and most successful to use computer quantitative models to turn investing into science.
Original title: "Billionaire Jimmy Simmons' Last Interview: This Hedge Fund Legend Talks About the Universe, Making Money and Charity"
Originally a mathematics professor and later the founder of a hedge fund, Jim Simons pioneered the use of automated quantitative models for investing and used his wealth to become America's premier philanthropist.
Recently, his foundation announced that he died at his home in Manhattan last Friday at the age of 86.
wealth
Simmons was a math genius who served as chair of Stony Brook's mathematics department, but he left Stony Brook in 1978, at the age of 40, to pursue a career in the stock market. He founded the hedge fund Renaissance Technologies in 1982 and the firm's Medallion Fund in 1988, which is known for beating the market and any investors who try to compete with it — while also keeping its recipe for success tight.
Renaissance Technologies is headquartered in East Setokate, New York, 70 miles east of New York City and off the coast of Long Island Bay. It has long been told to distance itself from traditional Wall Street traders and instead hire math geniuses around the world. Its minimalist website shows that 90 of its 300 employees have PhDs in mathematics, physics, computer science or related fields.
Renaissance Technologies now has about $50 billion in assets under management, and its medal fund has been open only to Simmons and company employees for decades. Medallion funds charge a management fee of 4% and a performance fee ranging from 36% to 44%, which is much higher than any other large hedge fund, but it is already worth the price. After fees, the fund has still returned more than 30% annualized since its inception. By comparison, Warren Buffett's Berkshire Hathaway has a compound annual return of just 20%.
That record put Simmons at the time of his death at the 51st place on the list of the world's richest people, with assets estimated by Forbes to be $31.4 billion. In 2004, he made his debut on the Forbes 400 list with a net worth of $2.5 billion.
charitable
Simmons is a low-key mystery, and the details of the investment strategy that brought him success remain largely a mystery to this day. His last public appearance was at the 11th Forbes America 400 Philanthropy Summit in New York in September 2023. At the time, he and his wife, Marilyn Simons, were honored with the Forbes 400 Philanthropy Lifetime Achievement Award.
They spoke to Maneet Ahuja, a contributing editor at Forbes, about their philanthropic work, and Mr. Simmons said Marilyn was the first to start the Simons Foundation in 1994. He joked on the podium: "As soon as I made money, Marilyn donated it." ”
This may have been the case when they first started doing philanthropy, but later in life, Simmons became more personally involved in their philanthropy. According to Forbes, he and Marilyn donated more than $6 billion through their foundation, making them the sixth-largest philanthropists in the United States. The Simmons Foundation had $4.9 billion in assets at the time of its most recent tax filing, which primarily support education, math and scientific research.
In a 2016 interview with Forbes, Simmons said, "The economy is increasingly dependent on quantitative skills, and we're lagging behind in teaching that."
Last year, the Simmons pledged to donate $500 million over seven years to Stony Brook University, the second-largest gift ever received by a public university. Simmons taught at Harvard University and the Massachusetts Institute of Technology before becoming chair of the mathematics department at Stony Brook University at the age of 30 and rose to fame for his work in topology and understanding the features of complex geometric figures. In 1976, he received the Oswald Veblen Prize of the American Mathematical Association, the highest honor in the field of geometry.
Speaking at last year's Forbes Philanthropy Summit, Simmons said, "Stony Brook University means extraordinary to us. Our math department wasn't supposed to be great, but Nelson Rockefeller, who was governor of New York at the time, liked State University so much that he gave me enough money to build a math department, and I did. ”
It was also at this school that he met Marilyn, who was studying for a doctorate. Last year, he also told the interesting story of how they met, even though it sounded a bit corny.
"My ex-wife was going to Europe for the summer, so I had to take care of our three children, so the school sent her (Marilyn) over to see if she could do the job," he said. We talked and talked, and finally I asked her, 'Do you have a boyfriend?' She said no, and everyone knew what happened next. ”
In 2004, they founded the Math for America Foundation, which provides annual stipends to 1,000 STEM teachers in New York City, giving out more than $300 million over two decades. The Foundation has also donated millions of dollars to the National Museum of Mathematics (MoMath) in New York. In a 2017 interview with Forbes, Simmons explained the importance of doing so.
"If you know enough math today to teach in high school, you're good enough to do a job at Google, Goldman Sachs or Renaissance Technologies," he said. Their salaries can be much higher than those of high school teachers. Therefore, this means that not so many people who know math will enter the field of teaching. ”
The Simmons Foundation has also donated hundreds of millions of dollars to support cancer and autism research at institutions like the Cold Spring Harbor Laboratory.
Simmons said last September, "Our foundation has a team that spends $100 million a year studying autism and deepening understanding of it. Of course, this is not the only job of the Foundation, but it is one of its most important. ”
universe
One of the foundation's most recent initiatives is a $90 million donation to the Simons Observatory in Chile. There, an advanced telescope at 17,000 feet above sea level, near the summit of Cerro Toco, a volcano in the Atacama Desert, is putting the finishing touches. These telescopes are expected to observe the so-called cosmic microwave background and map out all the radiation since the Big Bang in more detail than ever before. Simmons spoke about the project in an interview with Forbes last year, and his sagit and playful curiosity have been consistent.
"The conventional wisdom is that the universe started with a bits and pieces and then expanded dramatically, which is known as the Big Bang," Simmons said. If this is true, then the Big Bang causes gravitational waves. The first thing we do with this telescope is to see if there really were primordial gravitational waves in the first place. Personally, I kind of hope we won't find these gravitational waves, because I don't believe that the universe started from a single point. I think the universe existed before anything. But sooner or later we will figure out the truth. ”
文：Hank Tucker
翻译:Bella、Ash
Proofreading: Vivian
This article is translated from
https://www.forbes.com/sites/hanktucker/2024/05/10/billionaire-jim-simons-last-interview-the-hedge-fund-legend-on-the-universe-making-money-and-giving-it-away/
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Header image source: Getty Images
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