James Harris Simons (born 25 April 1938) is an American mathematician, billionaire, hedge fund manager, and philanthropist. He is the founder of Renaissance Technologies, a quantitative hedge fund based in East Setauket, New York. He and his fund are known to be quantitative investors, using mathematical models and algorithms to make investment gains from market inefficiencies. Due to the long-term aggregate investment returns of Renaissance and its Medallion Fund, Simons is described as the “greatest investor on Wall Street”, and more specifically “the most successful hedge fund manager of all time”.
As reported by Bloomberg Billionaires Index, Simons’s net worth is estimated to be $25.2 billion, making him the 66th-richest person in the world.
Simons is known for his studies on pattern recognition. He developed the Chern–Simons form (with Shiing-Shen Chern), and contributed to the development of string theory by providing a theoretical framework to combine geometry and topology with quantum field theory. In 1994, Simons founded the Simons Foundation with his wife to support researches in mathematics and fundamental sciences. He is one of the biggest donors to the University of California, Berkeley, establishing the Simons Institute for the Theory of Computing in 2012, and to Berkeley’s Simons Laufer Mathematical Sciences Institute, where he has served as a trustee since 1999.
In 2016, asteroid 6618 Jimsimons, discovered by Clyde Tombaugh in 1936, was named after Simons by the International Astronomical Union in honor of his contributions to mathematics and philanthropy.
The majority of Simons’s fortune is derived from the Medallion Fund, the signature investment vehicle of Setauket, New York-based Renaissance Technologies. Renaissance had about $50 billion in assets under management in January 2022, according to a Bloomberg News report.
Medallion’s quantitative investment strategies have delivered annual returns of about 40% since 1988, according to data compiled by Bloomberg. Renaissance caps Medallion’s assets at around $15 billion and distributes profits every six months, according to a person familiar. It was closed to outside investors in 1993 and is owned entirely by employees, according to documents released by the SEC, Department of Labor and Senate. Simons and three partners own about 70% of Renaissance, according to a 2014 Senate investigation.
His stake in Medallion is based on the top end of the 25-to-49.9% range disclosed in SEC filings from 1997 through 2009. Federal and New York state short-term capital gains tax rates are applied, and no market appreciation is included. Known charitable and political giving is reduced from the total.
In September 2021, Renaissance Technologies agreed to a settlement with the Internal Revenue Service that involved about $7 billion in taxes, fees and penalties, including a $670 million penalty payment by Simons. It centered on the payment of long-term versus short-term capital gains tax in the firm’s Medallion Fund. Because the short-term rate was already applied to Bloomberg’s calculation of Simons’ income from Medallion, only the $670 million penalty has been subtracted from his cash holdings.
Renaissance is valued at $10 billion, according to an analyst with a history of valuing hedge funds. It’s valued using a multiple of nine times earnings (higher than stakes sold by other asset managers with lower returns) and assumes a 30% return net of fees.
Jonathan Gasthalter, a spokesman for Renaissance, declined to comment on Simons’s net worth.
Biography
James Harris Simons was born on April 25, 1938 to an American Jewish family, the only child of Marcia (née Kantor) and Matthew Simons, and raised in Brookline, Massachusetts.
He received a bachelor’s degree in mathematics from the Massachusetts Institute of Technology in 1958 and a PhD in mathematics from the University of California, Berkeley under the supervision of Bertram Kostant in 1961 at the age of 23. After graduating from MIT, Simons traveled from Boston to Bogotá, Colombia on a motor scooter
Academic and scientific career
Simons’ mathematical work has primarily focused on the geometry and topology of manifolds. His 1962 Berkeley PhD thesis, written under the direction of Bertram Kostant, gave a new proof of Berger’s classification of the holonomy groups of Riemannian manifolds. He subsequently began to work with Shing-Shen Chern on the theory of characteristic classes, eventually discovering the Chern–Simons secondary characteristic classes of 3-manifolds. Later, mathematical physicist Albert Schwarz discovered early topological quantum field theory, which is an application of the Chern–Simons form. It is also related to the Yang-Mills functional on 4-manifolds, and has had an effect on modern physics. These and other contributions to geometry and topology led to Simons becoming the 1976 recipient of the AMS Oswald Veblen Prize in Geometry. In 2014, he was elected to the U.S. National Academy of Sciences.
In 1964, Simons worked with the National Security Agency to break codes.[22] Between 1964 and 1968, he was on the research staff of the Communications Research Division of the Institute for Defense Analysis (CRD of IDA) and taught mathematics at the Massachusetts Institute of Technology and Harvard University. After being forced to leave the IDA due to his public opposition to the Vietnam War, he joined the faculty at Stony Brook University. From 1968 to 1978, he was appointed chairman of the math department at Stony Brook University. Simons was asked by IBM in 1973 to attack the block cipher Lucifer, an early but direct precursor to the Data Encryption Standard (DES). Simons founded Math for America, a nonprofit organization, in January 2004 with a mission to improve mathematics education in United States public schools by recruiting more highly qualified teachers
He left Stony Brook in 1977 to start Monemetrics, a quantitative trading firm that focused on commodities. He changed its name to Renaissance Technologies five years later. He created his flagship Medallion fund in 1988. The fund, which is now almost exclusively run for the benefit of Renaissance employees, uses quantitative modeling and trading algorithms to invest in global markets, according to a Nov. 25, 2016 Bloomberg News report. Renaissance manages its money across several funds and Medallion, which caps its assets at about $15 billion, has delivered annual returns of 40 percent after fees.He stepped down as Chairman of Renaissance Technologies in January 2021.
Simons has been married twice. He had three children with his first wife, Barbara, and two with his second wife, Marilyn. Two of his sons died in accidents; one bicycle riding, another swimming in Indonesia.
Simons plans to give the majority of his wealth to philanthropic causes and signed the Giving Pledge in 2010.
Milestones
- 1938 Born in Brookline, Massachusetts, only child to a shoe factory owner.
- 1958 Completes bachelor’s degree in mathematics at MIT in three years.
- 1961 Receives doctorate at the University of California, Berkeley.
- 1977 Leaves Stony Brook to start quantitative trading firm Monemetrics.
- 1982 Renaissance Technologies founded.
- 1988 Renaissance’s Medallion fund begins trading.
- 2005 Starts Renaissance Institutional Equities Fund, invests in U.S. stocks.
- 2012 Renaissance Institutional Diversified Alpha Fund starts trading.
