appears to have a close connection with its subject . it may require cleanup to comply with wikipedia s content policies particularly neutral point of view . please discuss further on the talk page . january 2016 learn how and when to remove this template message renaissance technologies llc type private industry investment management founded 1982 ; 34 years ago 1982 headquarters east setauket new york united states key people james h. simons founder & board chair robert mercer co ceo peter brown co ceo 1 2 products medallion fund institutional equities fund institutional diversified alpha aum us 65 billion 2015 3 number of employees 290 2015 3 website www.rentec.com renaissance technologies llc is an east setauket new york based 4 american investment management firm founded in 1982 by james simons an award winning mathematician and former cold war code breaker which specializes in systematic trading using only quantitative models derived from mathematical and statistical analyses . renaissance is one of the first highly successful hedge funds using quantitative trading known as quant hedge funds that rely on powerful computers and sophisticated mathematics to guide investment strategies . in 1988 the firm established its most profitable portfolio the medallion fund which used an improved and expanded form of leonard baum s mathematical models improved by algebraist james ax to explore correlations from which they could profit . simons and ax started a hedge fund and christened it medallion in honor of the math awards that they had won . 5 6 renaissance s flagship medallion fund which is run mostly for fund employees 7 is famed for one of the best records in investing history returning more than 35 percent annualized over a 20 year span . 4 from 1994 through mid 2014 it averaged a 71.8 % annual return . 8 renaissance offers two portfolios to outside investors renaissance institutional equities fund rief and renaissance institutional diversified alpha rida . 9 simons ran renaissance until his retirement in late 2009 . 10 the company is now jointly run by peter brown and robert mercer two computer scientists specializing in computational linguistics who joined renaissance in 1993 from ibm research . 1 9 11 simons continues to play a role at the firm as non executive chairman and remains invested in its funds particularly the secretive and consistently profitable black box strategy known as medallion . 12 because of the success of renaissance in general and medallion in particular simons has been described as the best money manager on earth . 13 14 15 by october 2015 renaissance had roughly 65 billion worth of assets under management most of which belong to employees of the firm . 16 contents 1 academia and research 2 quantitative trading 3 quants with non financial background 4 monemetrics 4.1 medallion fund 4.2 medallion as a retirement fund 4.3 renaissance institutional equities fund rief 5 governmental affairs 5.1 tax avoidance investigation 2014 5.2 campaign contributions 6 see also 7 references academia and research edit james simons founded renaissance technologies following a decade as the chair of the department of mathematics at stony brook university . simons is a 1976 recipient of the oswald veblen prize of the american mathematical society which is geometry s highest honor . 17 he is a known in the scientific community for his work chern simons theory which today define many esoteric aspects of modern physics including advanced theories of how invisible fields like those of gravity interact with matter to produce everything from superstrings to black holes . 18 quantitative trading edit the firm is an early pioneer of quantitative trading where researchers tap decades of diverse data in its vast petabyte scale data warehouse to assess statistical probabilities for the direction of securities prices in any given market . experts attribute the breadth of data on events peripheral to financial and economic phenomena that renaissance takes into account and the firm s ability to manipulate enormous amounts of data by deploying highly efficient and scalable technological architectures for computation and execution for its consistent success in beating the markets . 19 in many ways renaissance technologies along with a few other firms has been synthesizing terabytes of data daily and extracting information signals from petabytes of data for almost two decades now well before big data and data analytics caught the imagination of mainstream technology . 20 for more than twenty years the firm s renaissance technologies hedge fund which trades in markets around the world has employed complex mathematical models to analyze and execute trades many of them automated . the firm uses computer based models to predict price changes in easily traded financial instruments . these models are based on analyzing as much data as can be gathered then looking for non random movements to make predictions . some also attribute the firm s performance to employing financial signal processing techniques such as pattern recognition . the quants describes the hiring of speech recognition experts many from ibm including the current leaders of the firm . quants with non financial background edit renaissance has the best physics and mathematics department in the world . mathematician isadore singer renaissance employs specialists with non financial backgrounds including mathematicians physicists signal processing experts and statisticians . the firm s latest fund is the renaissance institutional equities fund rief . 21 rief has historically trailed the firm s better known medallion fund a separate fund that only contains the personal money of the firm s executives . 22 in a 2013 article in the telegraph journalist sarfraz manzoor described renaissance staff as math geniuses running wall street . 15 of his 200 employees ensconced in a fortress like building in unfashionable long island new york a third have phds not in finance but in fields like physics mathematics and statistics . renaissance has been called the best physics and mathematics department in the world and according to weatherall avoids hiring anyone with even the slightest whiff of wall street bona fides . sarfraz manzoor the telegraph 2013 renaissance is a firm run by and for scientists employing preferably those with non financial backgrounds for quantitative finance research like mathematicians statisticians pure and experimental physicists astronomers and computer scientists . wall street experience is frowned on and a flair for science is prized . 18 it is a widely held belief within renaissance that the herdlike mentality among business school graduates is to blame for poor investor returns . 5 about a third of its about 300 or so employees have phds . renaissance engages roughly 150 researchers and computer programmers half of whom have phds in scientific disciplines at its tranquil 50 acre east setauket campus in long island new york which is near the state university of new york at stony brook . 23 mathematician isadore singer referred to renaissance s east setauket office as the best physics and mathematics department in the world . 24 the firm s administrative and back office functions are handled from its manhattan office in new york city . the firm is intensely secretive about the inner workings of its business and very little is known about it . 25 the firm is known for its ability to recruit and retain top scientific talent for having a personnel turnover that s nearly non existent 26 and for requiring its researchers to agree to stringent intellectual property obligations by signing iron clad non compete and non disclosure agreements . 27 monemetrics edit in 1978 simons left academia and started a hedge fund management firm called monemetrics in a long island strip mall . at first it didn t occur to simons to apply mathematics to his business which primarily traded currencies in the beginning but he gradually realized that it should be possible to make mathematical models of the data he was collecting . monemetrics name was changed to renaissance technologies in 1982 . simons started recruiting some of the best mathematicians and data modeling experts from his days at the institute of defense analyses ida and stony brook . his first recruit was leonard baum a cryptanalyst from ida who was also the co author of the baum welch algorithm . but when baum abandoned the idea of trading with mathematical models and took to fundamental trading simons brought in pioneering algebraist james ax from cornell university . ax expanded baum s models for trading currencies to cover any commodity future and subsequently simons set up ax with his own trading account axcom ltd. which eventually gave birth to the wildly profitable fund medallion . during the 1980s ax and his researchers improved on baum s models and used them to explore correlations from which they could profit . template ciite medallion fund edit from 2001 through 2013 the fund s worst year was a 21 percent gain after subtracting fees . medallion reaped a 98.2 percent gain in 2008 the year the standard & poor s 500 index lost 38.5 percent . rubin and collins . june 16 2015 . bloomberg in 1988 renaissance s established its most famous and profitable portfolio the medallion fund which used an improved and expanded form of leonard baum s mathematical models improved by pioneering algebraist james ax to explore correlations from which they could profit . simons and ax started a hedge fund and christened it medallion in honor of the math awards that they had won . 5 6 the mathematical models the company developed worked better and better each year and by 1988 simons had decided to base the company s trades entirely on the models . 5 6 by april 1989 peak to trough losses had mounted to about 30 % . ax had accounted for such a drawdown in his models and pushed to keep trading . simons wanted to stop to research what was going on . after a brief standoff simons pulled rank and ax left . simons turned to elwyn berlekamp to run medallion from berkeley california . in 1985 ax had persuaded simons to let him move axcom to huntington beach california . a consultant for axcom whom simons had first met at the ida berlekamp had bought out most of ax s stake in axcom and became its ceo . he worked with sandor straus jim simons and another consultant henry laufer to overhaul medallion s trading system during a six month stretch . in 1990 berlekamp led medallion to a 55.9 % gain net of fees and then returned to teaching math at university of california berkeley after selling out to jim simons at six times the price for which he had bought his axcom interests 16 months earlier . straus took the reins of medallion s revamped trading system and medallion returned 39.4 % in 1991 34 % in 1992 and 39.1 % in 1993 according to medallion annual reports . 5 28 renaissance s most famous portfolio the medallion fund is considered to be one of the most successful hedge funds ever that has averaged a 71.8 % annual return before fees from 1994 through mid 2014 . 8 this fund is closed to outside investors since 1993 and is available only to current and past employees and their families . the firm bought out the last investor in the medallion fund in 2005 and the investor community has not seen its returns since then . 7 about 100 of renaissance s 275 or so employees are what it calls qualified purchasers meaning they generally have at least 5 million in assets to invest . the remaining are accredited investors generally worth at least 1 million . 8 since its inception in march 1988 simons flagship 3.3 billion medallion fund has amassed annual returns of 35.6 percent compared with 17.9 percent for the standard & poor s 500 index . for the 11 full years ended december 1999 medallion s cumulative returns are an eye popping 2 478.6 percent . among all 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