Renaissance’s Medallion hiked investment caps 50 percent after Trump’s election

Re:Renaissance’s Medallion hiked investment caps 50 percent ... by chollida1 on Wednesday August 16, 2017 @10:00AM (#15027488)

It's amazing how a fund's focus switches from when it makes money collecting management fees from other people's money to when it only invests the partners capital:)

There aren't too many funds out there who actively give back capital on a quarterly basis to investors to ensure they aren't over capacity, and the ones you do hear about are usually shutting down a fund or kicking out the outside money all together.

> The firm told staff that they would be allowed to increase their Medallion stakes by at least 50 percent. The catch: they had just weeks to come up with the money.

This seems a bit punitive to the "rank and file" employees as if RenTech is like any other fund then...

- most of the executives probably have orders of magnitude more money in the fund already so a flat 50% increase benefits them alot more.

- its much easier for someone will 100's of millions in existing assets to get a loan in a week than someone with single digit millions or less.

As a side note, the link in the article was posted before but its still a terrific article if you want a look at RenTech

https://www.bloomberg.com/news/articles/2016-11-21/how-renai...

Just for fun RenTech just filed their 13F here are positions they sold or reduced:

AMD US (Advanced Micro Devices Inc), CVS US (CVS Health Corp), PCLN US (Priceline Group Inc/The), TEVA IT (Teva Pharmaceutical Industries Ltd), TSLA US (Tesla Inc), AET US (Aetna Inc), CMCSA US (Comcast Corp), FB US (Facebook Inc), MRK US (Merck & Co Inc), PX US (Praxair Inc),

and positions they added:

ADSK US (Autodesk Inc), AIG US (American International Group Inc), MCK US (McKesson Corp), PFE US (Pfizer Inc), WDAY US (Workday Inc), BMY US (Bristol-Myers Squibb Co), CL US (Colgate-Palmolive Co), DPZ US (Domino's Pizza Inc), EA US (Electronic Arts Inc), NVDA US (NVIDIA Corp)

Top holdings: NetEase Inc.-ADR: up 456,300 shares, to 2.73 million valued at $819.5 million

Johnson & Johnson: down 970,500, to 6.13 million valued at $811.2 million

Bristol-Myers: up 7.02 million, to 13.5 million valued at $751.6 million

Gilead Sciences Inc.: up 2.7 million, to 10.4 million valued at $736.7 million

Colgate: up 2.9 million, to 9.75 million valued at $723 million

The hedge fund manager's disclosed holdings rose 9.5 percent in value in the second quarter to $78.3 billion. The Standard & Poor's 500 index advanced 2.6 percent.

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Re:Renaissance’s Medallion hiked investment caps 50 percent ... by mwerd on Wednesday August 16, 2017 @12:57PM (#15029063)

13F filings are at best deceptive for a fund like medallion. That is, for any fund that is not primarily a net long equity fund, a 13F filing shows only a small subset of their position.

Medallion could hold any number of other positions in the form of derivatives etc. That are paired with or set against these common stock positions.

If you read or listen to Jim Simons he makes it pretty clear that Renaissance trades on relationships or trends and isn't particularly in the business of betting which individual stock is going to perform better than its peer group.

I don't think 13F filings are useful to understand their strategies.

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Re:Renaissance’s Medallion hiked investment caps 50 percent ... by champagnepapi on Wednesday August 16, 2017 @10:38AM (#15027796)

Interesting. I wonder what (if anything) the 13F means for a company like RenTech. Who knows how long they hold positions for (minute or less, or days and beyond), perhaps this could have just been a snapshot of an instant, or no? I ask this, since humans apparently do not trade there, they are not like a more traditional fund like Appaloosa, where humans decide when to get in/out of a position.

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Re:Renaissance’s Medallion hiked investment caps 50 percent ... by jandrewrogers on Wednesday August 16, 2017 @10:53AM (#15027900)

RenTech is not a fast-twitch fund, they generally hold their positions for a significant period of time.

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Re:Renaissance’s Medallion hiked investment caps 50 percent ... by whatok on Wednesday August 16, 2017 @10:57AM (#15027936)

Even if you were to subscribe to that notion, it's still on a quarter lag.

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Re:Renaissance’s Medallion hiked investment caps 50 percent ... by bingojess on Wednesday August 16, 2017 @11:11AM (#15028069)

Also Medallion has performance fees of 44% compared to the typical 20% of other funds. That's pretty crazy

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Re:Renaissance’s Medallion hiked investment caps 50 percent ... by SonOfLilit on Wednesday August 16, 2017 @12:12PM (#15028648)

And yet, I have a hard time imagining any RenTech employee that didn't just join having a hard time coming up with 50% of what they had invested in Medallion. I mean, it's about what Medallion made them last year?

Also, banks are apparently notoriously unafraid of taking the risk that RenTech would lose money. Source: my favorite Matt Levine piece: https://www.bloomberg.com/view/articles/2014-07-22/senate-li...

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Re:Renaissance’s Medallion hiked investment caps 50 percent ... by rayuela on Wednesday August 16, 2017 @10:59AM (#15027951)

Your write ups are always spot on Chris! I always look forward to your response in these finance related discussions.

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Re:Renaissance’s Medallion hiked investment caps 50 percent ... by vpribish on Wednesday August 16, 2017 @12:49PM (#15029002)

you can't be sure of much from their 13-Fs. Derivatives, swaps, forex, debt, cash, commodities, and shorts aren't reported and since you don't know how much leverage they use (reputed to be "a lot") you don't know how important those billions in equities are - they might be the hedges and the actual exposure is negative and the alpha is in the term structure of some derivative.

of course, you did say 'just for fun' since it seems you know this stuff :)

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