Jim Simons attends the IAS Einstein Gala honoring Jim Simons at Pier 60 at Chelsea Piers in New York City.
Sylvain Gaboury | Patrick Mcmullan | Getty Images
Jim Simons, a mathematician who founded the most successful quantitative hedge fund of all time, died Friday in New York City, his foundation announced on its website.
Simons pioneered mathematical models and algorithms to make investment decisions and left an otherworldly track record at Renaissance Technologies, which defeated legends like Warren Buffett and George Soros. The flagship Medallion Fund achieved an annual return of 66% during a period beginning in 2018, according to Gregory Zuckerman's book “The Man Who Solved the Market.”
During the Vietnam War, he worked as a codebreaker for an American intelligence service that fought against the Soviet Union and successfully cracked the Russian code.
Simons earned a bachelor's degree in mathematics from MIT in 1958, and he received his PhD in mathematics from the University of California, Berkeley, at age 23. The quantitative guru founded what became Renaissance at the age of 40, after leaving academia. and decided to make an attempt at trading.
Unlike most investors who studied fundamental factors to assess a company's value, Simons relied entirely on an automated trading system to take advantage of market inefficiencies and trading patterns.
His Medallion Fund made more than $100 billion in trading profits between 1988 and 2018, with an annualized return of 39% after fees. The fund was closed for new money in 1993 and Simons only let his employees invest in it from 2005.
Quantitative strategies that rely on trend-following models have become popular on Wall Street since Simons revolutionized trading. According to an estimate by JP Morgan, quant funds now account for more than 20% of all equity assets.
According to Forbes, Simons' net worth was estimated at $31.4 billion when he died.
The quantitative guru previously chaired the mathematics department at Stony Brook University in New York and his mathematical breakthroughs are of great importance to fields such as string theory, topology and condensed matter physics, according to his foundation.
Simons and his wife founded the Simons Foundation in 1994 and have given away billions of dollars to philanthropic causes, including those that support mathematical and scientific research.
He was active in the work of the foundation until the end of his life. Simons is survived by his wife, three children, five grandchildren and one great-grandchild.