May Book Review: The Man Who Solved the Market
In this month’s book review, I would like to focus our attention on a book that brings to light the story behind the success of a one-of-a-kind hedge fund. I am talking about Renaissance Technologies (“RenTech”) and the book that exposed the secrets and the people behind it “The Man Who Solved the Market” by Gregory Zuckerman. Those who are familiar with the hedge fund industry might have heard about RenTech and its incredible performance, but many have no idea about the existence of the fund and the people behind it, and how they beat and continue to beat the market since the 1990s.
Even if you are not into trading and computer science, this book provides an incredible glimpse and breathtaking story about what happens behind the curtain of a major quant house on Wall Street and how it truly operates. RenTech is known to be one of the most successful but secretive funds in the industry, and its employees typically heavily guard the insides of the fund. It is basically impossible to understand what the secret source is, and the financial industry just treats RenTech as a moneymaking machine. However, Zuckerman was able to discover some unknown to the public facts and information, which makes this book a very interesting read.
In his book, Zuckerman focuses on Jim Simon and several mathematicians at RenTech, who Simon discovered and brought on board in the late 80s and early 90s. In brief, Simon is a former codebreaker for the United States government and a brilliant mathematician, who founded and brought the highly secretive RenTech to success. The book provides a relatively broad history of Simon’s life before the RenTech and how it all led to the creation of an extraordinary fund. Furthermore, Zuckerman was able to unveil some secrets the fund has, how it operates and uncovered how powerful the managers of the fund truly became. For instance, Zuckerman spends time telling a story about Robert Merce, a billionaire and a former CEO of the firm, who founded Breitbart News and Cambridge Analytica, which allegedly influenced a number of political events around the world.
Thus, if you would like to learn how mathematicians created a computer code, which generates consistent and outstanding returns to this date, how all this led to an unbelievable amount of wealth and power, and how one man rewrote the history of the financial industry forever, we would definitely recommend spending some time next month on reading this remarkable book.
The material on this page reflects PG Capital's professional opinions as of today and is subject to change. The information presented here has not taken into account any particular investor's investing goals or needs, and investors should not base their investment decisions entirely on this material. Past performance is not a guarantee of future results. All investments involve some amount of risk, and investors have different time horizons, goals, and risk tolerances, so consult with your PG Capital Financial Advisor before proceeding.