Tony Talks History
The Codebreaker Who Beat Wall Street | Renaissance Technologies & the Medallion Fund
There is a fund on Long Island that has not lost money in a single year since 1988. Before fees it averaged about sixty six percent a year. You cannot buy into it. Nobody outside that building can.
It is real, and almost everything said about it online is guesswork.
The numbers in this video
66%The Medallion fund's average return a year before fees, roughly. The study behind the figure covers 1988 to 2018.Source: Bradford Cornell's paper on the Medallion fund, and the PWL Capital write-up of it
50.75%How often the fund is right, in the figure Robert Mercer used in public. About 508 bets in every thousand come good and 492 lose.Source: Robert Mercer, quoted widely
30%How much of the fund was gone by the end of its losing run through 1989, roughly.Source: Zuckerman, The Man Who Solved the Market; Wikipedia
44%The share of profits Medallion took in fees from 2002, up from 36% the year before, on top of 5% of assets.Source: Wikipedia
76%Medallion's gain in 2020, roughly, one of the best years in its history.Source: Institutional Investor, January 2021
$7BThe most that Simons, Mercer and other executives agreed to pay in a 2021 tax settlement. The video says up to seven billion dollars.Source: CNBC and the Wall Street Journal, September 2021
Every number has a source
Chapters
- 0:00Nobody Beats the Market
- 2:161964: The Codebreaker
- 3:111967: The War
- 3:511968: The Department
- 5:001978: The Strip Mall
- 5:481980s: The Algorithm
- 6:441988: The Medal
- 7:211989: The Rebuild
- 8:43The Edge
- 10:481993: The Voices
- 13:222001: The Door
- 14:33The Size Limit
- 15:312005: The Ones You Can Buy
- 17:092014: The Bill
- 18:35The Last Years
- 20:01What Survived
What we left out
Claims we found and could not stand behind, so they are not in the video.
A dollar figure for Simons' own fortune, or for what Berlekamp's stake would be worth now. The video says out loud that it will not give one.
What the fund's trading signals actually are. Nobody outside the firm knows, and the video says so near the start.
The year outside investors were shut out. One source says from 1993 and another says 2003, so the video gives no date.
