" We can't put a lot of money in it or we will push the markets too much." I took that as he pushes the markets a little and that is probably all you got to be able to do to obtain that sliver of an edge.
Great video, congratulations! Jim Simons, Renaissance Technologies and Medallion Fund are well-known and deeply investigated topics, so it is very hard to make a new, stimulating video about them. You just succeded in doing it.
I feel like the odds of this are crazy. But literally today I was talking about the medallion fund to someone at work, which is not a normal occurrence. And now I come home and see you posted a video about it yesterday. Life is strange, gotta love it.
Been watching Andrie for years and this was by far one of the most interesting and entertaining videos I have ever watched. Thank you for all educational and fun videos you create . I really respect and appreciate all the time and effort you put into your content. Thank you again
Love andrei because he doesn't recycle his material like his good friend Graham stephan putting out the exact same video every week. Keep up the great work Andrei!
What's important to understand as well is that computing and data in 1988 was orders of magnitude less than now. This means that medallion, at least during the first decades, was NOT using big data. They were using MATH. They found some set of mathematic principles that created their success.
They did. Reading the charts is probably the hardest part, although some of it is probably a lot less complicated than you think. There was a guy that used to be on RUclips called the popular investor. The last project he was working on before he got rid of his channel was creating a fund better than the s&p. I don't remember what criteria he was using to create the ETF, but it was not terribly complex. Some reasoning that makes sense.
It limited their losses to what they would be unleveraged but allowed them to capitalise far more on their correct positions. So in effect to win the same amount of money without leverage they would have had to risk more capital. Hence it reduced their exposure and limited their loss without penalising the return.
At this point, the Medallion Fund IS the anomaly. They are the fund that pushes things a little this or that way to bring the results. The Market Maker's market maker.
Every theoretical physicist and many a mathematician knows Simons from gauge field theory, which is what he did before. I talk about him in videos, but never so far in relation to finance. It's also the case that he had two sons die at adult age. Sports accidents and so on. Money can turn out to be a bit of a curse sometimes.
@@BigHotSauceBoss69 I'm familiar with both the cited interview (Brady from numberphile) as well as the speech given at the event. I gotta say, I'm always a bit skeptical regarding the giveaway claims. It might well be genuine, but surely often those money pipelines, Simons foundations in his case I think, is motivated by the tax law.
Its not the .75% edge, its their payout if they win , peter lynch talked about this years ago in the 90s if you buy 10 companies that have the capacity to 10x and limited downside you may only lose seriously on two, six will be ok, and two will 10x, every 1/10 bet has the chance of giving you 100% return. If you are not right even 20% of the time and your time horizon isn't prolonged you win pretty big.
The scary thing is the AI revolution could kill investing. Because if he is only looking for subtle mathematical patterns a properly configured AI should be able to do the same and some muppet will figure it out and break the market. All the big financial companies are investing in AI so at some point it will hit critical mass.
6:50 what? Using leverage is massively (exponentially) INCREASING Risk for the benefit of margin if you are right for a particular time horizon. If you are wrong, it magnifies loss. Complete opposite of what you said. Leverage can even create loses even if you were right on the direction under certain circumstances.
Thank you for this great video. This is a great example of why all these “magic indicator” that cost an arm and a leg are mostly, can work to a point but truthfully they are rubbish because if it were a magic tool, it would not be open to the public and this is a perfect example to all the newbies.
%50.75 win rate is actually a really good win rate. This is because most of the winning trades are leveraged and the losing ones are closed early. Even if we assume a 2:1 RR, That's still really good.
the explanation for margin makes no sense. margin increase your liability. if you have one dollar and leverage it to 20 to make a bet that loses 100%… you don’t suddenly not owe your brokerage the margin..
He tutors at suny stony brook on a wim. Jim Simmons is an awesome man. Imagine sitting with a math genius to go over your summer math problems. Then later finding out he is a billionaire math professor who doesn't even teach anymore. He just does whatever he feels like doing.
I think they abuse market maker mechanics. They force MM delta hedging by positioning high delta in short term time periods. Sometimes they get lucky and force gamma squeezes.
Andrei make a video of the benefits/differences between buying the Bitcoin ETF and buying in Coinbase and sending to cold storage. Specially when it comes to fees for accounts under $100K.
Every crash/collapse brings with it an equivalent market chance if you are early informed and equipped, I've seen folks amass up to $1m amid economy crisis, and even pull it off easily in favorable conditions. Unequivocally, the collapse is getting somebody somewhere rich.
Dealing across multiple asset classes can reduce risk more effectively than putting all of your money into one. If you don't understand finances properly, see a financial consultant.
My CFA ’ Julianne Iwersen Niemann ’ , a renowned figure in her line of work. I recommend researching her credentials further. She has many years of experience and is a valuable resource for anyone looking to navigate the financial market.
Huh I thought it was going to be about taxi medallions. Those things sky rocketed but I imagine they are down these days with ride share. Edit: just checked. Chicago medallions went for 350k in 2013. Today they are worth about 10k. 😢
La ultima vez que estuve tan impactado fue cuando vi la película The Avengers End Game, pero este vídeo es tan asombroso que parece una película de ciencia ficción que te mantiene completamente enganchado hasta su descenlace. Muy interesante información. Muchas gracias!
I bet I can bring it down 50 % as soon as i invest in it
🤣 the true test of the fund
Hands down best comment of this month
Just only put in a dollar (if that’s possible) and watch everyone else lose money
Start your own Medallion Fund Short ETF after u put your money in. 😝
😂😂😂
Please do more of these Andrei, they’re entertaining and educational at the same time!!
Hands down, this was the coolest and most interesting finance video that I've ever seen. Well donee!!
Glad you enjoyed it!
" We can't put a lot of money in it or we will push the markets too much." I took that as he pushes the markets a little and that is probably all you got to be able to do to obtain that sliver of an edge.
yeah...a little pushing is good.."
Exactly. They force market movements by abusing market maker mechanics by forcing MM delta hedging.
@@farlouxyou’re one of the few ppl who knows what he’s talking about. Few ppl even know about this. Well said.
It isn't a practical fund. As there is no market Participation balance.
Great video, congratulations! Jim Simons, Renaissance Technologies and Medallion Fund are well-known and deeply investigated topics, so it is very hard to make a new, stimulating video about them. You just succeded in doing it.
YOU describe the most complicated subjects in a way that is easy to understand. Thank you Andrei - ALOHA from MAUI
Wow, thank you! BTW, I love Maui! Hope you're well!
Thank you Andrei! You truly are one of the best at educating everyone that wants to learn about the finance world as a whole.👍👍
I feel like the odds of this are crazy. But literally today I was talking about the medallion fund to someone at work, which is not a normal occurrence. And now I come home and see you posted a video about it yesterday. Life is strange, gotta love it.
That's pretty crazy!
Been watching Andrie for years and this was by far one of the most interesting and entertaining videos I have ever watched. Thank you for all educational and fun videos you create . I really respect and appreciate all the time and effort you put into your content. Thank you again
Appreciate the kind words, I worked hard on this one, so it took me a while but I had a blast with it
Great job!@@AndreiJikh
"I gave almost all of it away" he says with a straight face while his net worth sits at $30.7B from a private fund.
Which maybe says more about how much he gave away...
Maybe if he hadn't, he'd make Musk look like he was just 'sorta' rich.
He walks and talks and looks like Bernie Madoff. The one trait they all participate in that gives them away? They are HUGE in philanthropy.
$30.7B is the low end of what he could have had
LOL.....they are trained to act like this
@@randyosborne3971 but how can it be a ponzi scheme if is closed to the public?
i clicked on this because of the thumbnail. nailed it.
Lol yeah, thats was pretty extraordinary lol.
Same lol
I clicked it bc it said wall st 😭
@@broken_casper Um
I see what you just did there with your comment
Andrei…😮 I’ve been reading this book for the last couple days. Great book. Great video!
Love andrei because he doesn't recycle his material like his good friend Graham stephan putting out the exact same video every week. Keep up the great work Andrei!
What's important to understand as well is that computing and data in 1988 was orders of magnitude less than now. This means that medallion, at least during the first decades, was NOT using big data. They were using MATH. They found some set of mathematic principles that created their success.
They did. Reading the charts is probably the hardest part, although some of it is probably a lot less complicated than you think. There was a guy that used to be on RUclips called the popular investor. The last project he was working on before he got rid of his channel was creating a fund better than the s&p. I don't remember what criteria he was using to create the ETF, but it was not terribly complex. Some reasoning that makes sense.
So is it breaking down now?
?????? WHAT@@someonethirsty1957
@@momentumstocks3493 no idea. I have no visibility into their method. Wish I did :-)
They had A.I early
Thank you for this lesson in history Andrei. Great work and very entertaining as always!
Thanks again!
Bitcoin ETF approved!
Amazing video. Thank you for this information. Your story telling and pace and everything is so on point i could watch this again.
Glad you enjoyed it!
I just found out about Jim Simons yesterday and their you are Andre posting a video. Perfect timing! 😊
Perfect!
If only i found out about him in 1988 😂
Thanks the reply mate! Keep up the awesome content 💪💪
Still not getting why using leverage can limit their losses..
that because he does not understand what leverage
is
@@chineduugoagwu3232 Chinedu How Far Now?
When you make graph up or down themselves you can earn even more
It limited their losses to what they would be unleveraged but allowed them to capitalise far more on their correct positions. So in effect to win the same amount of money without leverage they would have had to risk more capital. Hence it reduced their exposure and limited their loss without penalising the return.
Clearly a time traveler is behind this
Obviously!
Great video, not much value, but still a great watch
Thanks for being consistent Andrej
Wow what a backhanded compliment
At this point, the Medallion Fund IS the anomaly. They are the fund that pushes things a little this or that way to bring the results.
The Market Maker's market maker.
Time traveling Aliens
Isn't this "front running"?
The Acquired Episode on this was extremely good
Appreciate the hard work and research you put in week after week, providing us with this insightful content!! 261 viewer
Thank you!
Great editing, thx! All the best for a formidable 2024 from Germany!!
Thank you very much!
Germany is going down the toilet in 2024 along with the EU. Thank God for Brexit !
What?!?!??! You did it!!! :)
Your explanation of the Medallion Fund is very well done! So Awesome!!! 😀😀😀
Yes! Thanks for the comment haha, it was inspired by the comment you left
Thanks for leaving the comment! Such an awesome video
Damn super cool. Refreshing video compared to all the "FED RATES GO UP/DOWN" videos
Every theoretical physicist and many a mathematician knows Simons from gauge field theory, which is what he did before. I talk about him in videos, but never so far in relation to finance. It's also the case that he had two sons die at adult age. Sports accidents and so on. Money can turn out to be a bit of a curse sometimes.
his short speech at the end goes to show you how much the money meant to him at that moment. nearly nothing.
@@BigHotSauceBoss69 I'm familiar with both the cited interview (Brady from numberphile) as well as the speech given at the event. I gotta say, I'm always a bit skeptical regarding the giveaway claims. It might well be genuine, but surely often those money pipelines, Simons foundations in his case I think, is motivated by the tax law.
Good book recommendation! 📈 nice fifty fathoms.
I just majikhally realized that Andrei is wearing my favorite watch - swatch diving watch ❤
Its not the .75% edge, its their payout if they win , peter lynch talked about this years ago in the 90s if you buy 10 companies that have the capacity to 10x and limited downside you may only lose seriously on two, six will be ok, and two will 10x, every 1/10 bet has the chance of giving you 100% return. If you are not right even 20% of the time and your time horizon isn't prolonged you win pretty big.
What jim did is add leverage and relatively predictable cases, used computers to find a way to skim without pushing the markets around
Great video. Thank you. You were the first video, I watched on this Fund, that explained why it was “only” a $10 billion Fund. Subscribed.
The scary thing is the AI revolution could kill investing. Because if he is only looking for subtle mathematical patterns a properly configured AI should be able to do the same and some muppet will figure it out and break the market. All the big financial companies are investing in AI so at some point it will hit critical mass.
Fantastic video Andrea…I was glued to the screen! Thank you.
Glad you enjoyed it!
RUclips algo spot on with this recommendation
I enjoyed this video and am going to get the book.
Hope you enjoy it!
6:50 what? Using leverage is massively (exponentially) INCREASING Risk for the benefit of margin if you are right for a particular time horizon. If you are wrong, it magnifies loss. Complete opposite of what you said. Leverage can even create loses even if you were right on the direction under certain circumstances.
Well done video! Laid out the context very well
My favorite RUclipsr ever!
same here
Glad to see your finally learning the efficient market hypothesis is incorrect.
Appreciate your content and honesty
I am liking your watches, I have a feeling you're a watch guy. When I fly over the pond I will come do a video if that is ok with you.
Thank you for this great video. This is a great example of why all these “magic indicator” that cost an arm and a leg are mostly, can work to a point but truthfully they are rubbish because if it were a magic tool, it would not be open to the public and this is a perfect example to all the newbies.
Great vid! Awesome watch btw
Broke the financial Matrix code.
Boom! Great video topic. Thank you Andre
Commendable presentation and story-telling
Amazing video. Thank you for making this.
Very interesting video!
I really enjoyed!
Thanks Andre
So it would expose the flaw in Fiat 🤔 love this one brother 👍
This level of quant computing didn't exist in the 90s.
As far as the public is concerned, but at least in the financial sector it seems like it was around (at least in the beginning phase of it)
Good one Andrei.
I wonder if they invested in Enron and knew when to pull out. A warning like that could’ve saved people’s retirement
Feeling like listen to this clip equal to not listening 😂😂
This was awesome. 🤙🤙🔥🔥
Dang, I wonder what it would take to recreate even a little of this.
A lot of mathematicians, data, and a few billion to start with :P
Great book
interesting story...but the simplest answer is almost always the right one...they just have connections and were betting on the winning horse.
The wolf of wall street is my favorite movie so I had to watch this video
Great video. Enjoyed it. Learned a few new things.
Glad to hear it!
Yet you don't see him on Google as the riches man why is that? I researched this last week must say you did a very good job loved the vid
It’s because it does not scale well. Can’t do it with BIG money like Buffet can
Absolutely fascinating!
“Margin of error” good one haha
Funny that you showed Peter Stormare (a Swedish guy) when you did your Russian accent :)
%50.75 win rate is actually a really good win rate. This is because most of the winning trades are leveraged and the losing ones are closed early. Even if we assume a 2:1 RR, That's still really good.
you are amazing
finally! something good
Liked and subbed homie 👍✌️
Talk about the Benner cycle chart and its predictions please.
the explanation for margin makes no sense. margin increase your liability. if you have one dollar and leverage it to 20 to make a bet that loses 100%… you don’t suddenly not owe your brokerage the margin..
I think he means that since they have a 10B cap for the fund they can keep that 10B intact while leveraging.
He tutors at suny stony brook on a wim. Jim Simmons is an awesome man. Imagine sitting with a math genius to go over your summer math problems. Then later finding out he is a billionaire math professor who doesn't even teach anymore. He just does whatever he feels like doing.
I think they abuse market maker mechanics. They force MM delta hedging by positioning high delta in short term time periods. Sometimes they get lucky and force gamma squeezes.
The leverage they use isn't margin, it's options. High delta leveraged options.
pretty clear someone has figured out time travel and went back in time to start the Medallion Fund lol
Love your watch!!! Where did you buy it from?
Thanks! My mom actually gave it to me for my birthday! Blancpain X Swatch
Buffett worth 100B, Simons 25B. Both have given away a lot, Buffett probably 30B.
Buffet hasn’t given away $1. Don’t be fooled.
Interesting and fun video! Thanks!
Good video, thanks
So they are the ones eating when my options expire worthless.
Andrei make a video of the benefits/differences between buying the Bitcoin ETF and buying in Coinbase and sending to cold storage. Specially when it comes to fees for accounts under $100K.
Pretty sure there was a year where medallion lost 0.5% but still incredible fund. RIP Jim Simmons
That AI matrix voiceover made it obligatory to smash the like button😂😂😂
I’m going to apply to be the janitor at renaissance technologies 😂 I must have access to this fund
haha let me know if you get in, I'll help with mopping!
Yes, please provide the guide you mentioned.
Smart people are so fascinating
I wonder what it's like... :P
Andrei, great video name of book mentioned in here ,please, ty...
Every crash/collapse brings with it an equivalent market chance if you are early informed and equipped, I've seen folks amass up to $1m amid economy crisis, and even pull it off easily in favorable conditions. Unequivocally, the collapse is getting somebody somewhere rich.
Dealing across multiple asset classes can reduce risk more effectively than putting all of your money into one. If you don't understand finances properly, see a financial consultant.
My CFA ’ Julianne Iwersen Niemann ’ , a renowned figure in her line of work. I recommend researching her credentials further. She has many years of experience and is a valuable resource for anyone looking to navigate the financial market.
I can't help but thinking Ponzi scheme. Or too good to be true.
Informative!
Andrei? Great work bud. But I believe the Megallen fund by Peter Lynch created in 1984 stomps this fund.
Thanks! I looked into it, it looks like the Medallion fund is still miles ahead in terms of annual returns
That's not the actual definition of EMH, it's the popular misconception.
Huh I thought it was going to be about taxi medallions. Those things sky rocketed but I imagine they are down these days with ride share.
Edit: just checked. Chicago medallions went for 350k in 2013. Today they are worth about 10k. 😢
How did u find all of their financials but people like us can't use it
Who's afraid that something like a sophisticated AgI will begin to manipulate the market in some way before noticed or maybe even until it's too late
Even at 50% successful trades or even less they probably have a system where the upside pays more than the downside loses
Amazing video!
Fascinating information! Thanks, Andrei
Glad it was helpful!
Andrei this was informative, but II appreciate more ideas on how to, hypoteticlly than info on a FunI cannot invest!
Wow 🤩 thanks 🙏
20x leverage is insane. A 5% drop would instantly wipe out everything you own.
La ultima vez que estuve tan impactado fue cuando vi la película The Avengers End Game, pero este vídeo es tan asombroso que parece una película de ciencia ficción que te mantiene completamente enganchado hasta su descenlace. Muy interesante información. Muchas gracias!
They need to let the government invest in it so they can pay down the national debt
😂 the world debt instead! To who? Pluto? Or Uranus?