Senior people at Renaissance Technologies have been hit with the mother of all clawbacks from federal authorities in the U.S., but don't presume that everyone at the fund is a huge earner.
Renaissance Technologies revealed yesterday that its top executives, their spouses, and some of its investors have agreed to repay around $7bn in back taxes to the U.S. internal revenue service over an unspecified period. Jim Simons, the firm's founder and recent retired chairman, is expected to repay $670m alone according to the Wall Street Journal.
Given that Simon's net worth is seemingly $24.5bn, up from $18bn last time we looked two years ago, this is presumably something Simons can afford. Between 1988 and 2018, Renaissance's Medallion Fund generated returns of 40% a year using proprietary algorithms and high frequency trading - before high frequency trading was a thing. When he was working, Simons earned around $184k an hour.
This doesn't mean, however, that everyone at Renaissance Technologies is inordinately well paid. Renaissance Technologies isn't a public company and pay figures are therefore hard to come by, but publicly available data for salaries alone suggest they're modest at best.
The chart below shows the salaries Renaissance Technologies is paying quants and engineers it hired for its East Setauket New York office on H1B visas. The fund is known for only hiring a small number of elite researchers.
The data suggests that experienced 'mathematical researchers' (ie. quants) at Renaissance Technologies receive some of the highest salaries at the fund, but that their salaries are less than $200k.
Needless to say, however, salaries aren't the reason most people want to work for Renaissance. The real lure is the opportunity to invest in the Medallion Fund, which is only open to employees and has been closed to outside investors since 1993. Bloomberg reported in April that the Medallion Fund had a banner year in 2020, and reduced the fee it charges employees from 5% to 4%, making their investments even more lucrative than usual.
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