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The culture of secrecy and non-competes is designed to filter away, even before the interview, candidates (a) unsure about their willingness to commit What are

The culture of secrecy and non-competes is designed to filter away, even before the interview, candidates (a) unsure about their willingness to commit What are the benefits of working at RenTech? They seem to be asking candidates to take a huge risk to their careers, due to the legally-mandated secrecy. That suggests there's a proportionally huge payoff in working there. What is it?

dman 12y ago
Apart from the great pay you get to invest in RenTech funds. I might be wrong but I think at this point theyre just working to manage their own money and not taking any money from investors. Above all else - working with smart people is its own reward.
- freyr 12y ago
  > Above all else - working with smart people is its own reward Of course, there's also the reward of building, creating, and contributing to something that extends beyond yourself. It's hard to believe that a career at a secretive hedge fund that invests its own funds would provide much along that axis of career satisfaction. Some individuals are motivated by their interaction with smart colleagues, but others by the process of the work itself, others by financial incentive, others by prestige, others by societal impact, etc. There is no one-size-fits-all metric that guarantees satisfaction.
foobarqux 12y ago
I think all employees can invest in the Medallion fund, which has a 50%/year return.
- sillysaurus3 12y ago
  Would anyone speculate about what mathematics and methods they use to achieve a 50%/yr return? I wonder if there's a way to reverse engineer their model by e.g. looking up which research papers their employees published prior to joining RenTech.
  - foobarqux 12y ago
    If anyone knew they wouldn't certainly wouldn't share it. No one seemingly knows because no other fund has a comparable return, which is surprising because typically ideas diffuse as employees go work for other firms. I suspect they use the ability to continue to invest in Medallion as an incentive to prevent people from going to work elsewhere.
    - sillysaurus3 12y ago
      It should be possible to figure out their methods. Besides, it'll be a lot of fun. Is there a data dump somewhere of Medallion's trades over time? Since the stock market is public, that means we could treat their investment engine as a black box, and try to reverse engineer their engine by looking at the decisions it makes over time. We should pay careful attention to how it performed leading up to the 2008 crash, since that reveals how their engine performs in adverse conditions, which might indicate what underlying metrics their engine is using.
      - reverend_gonzo 12y ago
        Any firm's trades are absolutely not public information.
        sillysaurus3 12y ago
        Given a dump of all stock market trades over a month, I wonder if it's possible to algorithmically group those trades into cohorts to identify the source of the trades. In other words, Medallion fund presumably manages a large amount of money; therefore, when they move that money into different investments (on a daily basis?) then we should see large trades (or many small trades that add up to a large amount). I wonder what the daily trade volume of the NYSE is? It seems like if someone is moving around a billion dollars via thousands of trades, it should be possible to detect and categorize those seemingly-disparate trades as "these trades originated from the same owner". If it's possible to trace the flow of money in that way, then it may be possible to generate a list of probable Medallion trades: search for a cohort that achieved >40% return on billions in volume. Another way of figuring out Medallion's methods is to examine its interaction with academia. Presumably they search for candidates from fields related to their trade engine. If we can generate a list of research papers which resulted in its authors being hired by Medallion, then those research papers may reveal some of the techniques used by their trade engine.
- gwern 12y ago
  If it really had that high a return, wouldn't they basically own the economy by now?
  - aklein 12y ago
    They distribute back all profits and keep the total capitalization of the fund constant. Yes, it really has returned that amount for 20+ years.
- kirsebaer 12y ago
  Doesn't this sound like Madoff and Picower?

dman 12y ago

Apart from the great pay you get to invest in RenTech funds. I might be wrong but I think at this point theyre just working to manage their own money and not taking any money from investors. Above all else - working with smart people is its own reward.

freyr 12y ago
> Above all else - working with smart people is its own reward Of course, there's also the reward of building, creating, and contributing to something that extends beyond yourself. It's hard to believe that a career at a secretive hedge fund that invests its own funds would provide much along that axis of career satisfaction. Some individuals are motivated by their interaction with smart colleagues, but others by the process of the work itself, others by financial incentive, others by prestige, others by societal impact, etc. There is no one-size-fits-all metric that guarantees satisfaction.

foobarqux 12y ago

I think all employees can invest in the Medallion fund, which has a 50%/year return.

sillysaurus3 12y ago
Would anyone speculate about what mathematics and methods they use to achieve a 50%/yr return? I wonder if there's a way to reverse engineer their model by e.g. looking up which research papers their employees published prior to joining RenTech.
- foobarqux 12y ago
  If anyone knew they wouldn't certainly wouldn't share it. No one seemingly knows because no other fund has a comparable return, which is surprising because typically ideas diffuse as employees go work for other firms. I suspect they use the ability to continue to invest in Medallion as an incentive to prevent people from going to work elsewhere.
  - sillysaurus3 12y ago
    It should be possible to figure out their methods. Besides, it'll be a lot of fun. Is there a data dump somewhere of Medallion's trades over time? Since the stock market is public, that means we could treat their investment engine as a black box, and try to reverse engineer their engine by looking at the decisions it makes over time. We should pay careful attention to how it performed leading up to the 2008 crash, since that reveals how their engine performs in adverse conditions, which might indicate what underlying metrics their engine is using.
    - reverend_gonzo 12y ago
      Any firm's trades are absolutely not public information.
      - sillysaurus3 12y ago
        Given a dump of all stock market trades over a month, I wonder if it's possible to algorithmically group those trades into cohorts to identify the source of the trades. In other words, Medallion fund presumably manages a large amount of money; therefore, when they move that money into different investments (on a daily basis?) then we should see large trades (or many small trades that add up to a large amount). I wonder what the daily trade volume of the NYSE is? It seems like if someone is moving around a billion dollars via thousands of trades, it should be possible to detect and categorize those seemingly-disparate trades as "these trades originated from the same owner". If it's possible to trace the flow of money in that way, then it may be possible to generate a list of probable Medallion trades: search for a cohort that achieved >40% return on billions in volume. Another way of figuring out Medallion's methods is to examine its interaction with academia. Presumably they search for candidates from fields related to their trade engine. If we can generate a list of research papers which resulted in its authors being hired by Medallion, then those research papers may reveal some of the techniques used by their trade engine.
gwern 12y ago
If it really had that high a return, wouldn't they basically own the economy by now?
- aklein 12y ago
  They distribute back all profits and keep the total capitalization of the fund constant. Yes, it really has returned that amount for 20+ years.
kirsebaer 12y ago
Doesn't this sound like Madoff and Picower?