Key Takeaways
- • Two Sigma has pushed past the $50bn assets under management mark, according to the Financial Times, placing it on a par with Renaissance Technologies as one of the largest quantitative hedge fund managers globally.
- • Investor inflows into computer-driven quantitative hedge funds have roughly halved in 2017, slowing to their most sluggish pace since 2009, per the Financial Times.
- • Two Sigma's Absolute Return fund reportedly gained 3% in March while its Spectrum fund rose 2.5%, against a 5% decline in the S&P 500 that month.
- • Since its founding, Two Sigma has reportedly generated $15.2 billion in net gains, ranking No. 19 among all hedge fund firms.
Summary
Two Sigma has risen rapidly to the top tier of the quantitative hedge fund industry, having surpassed $50bn in assets under management, according to the Financial Times. That figure places the New York-based firm on a par with Renaissance Technologies, long regarded as the largest quant manager in the world. The Financial Times article frames the ascent against a backdrop of slowing industry growth: investor inflows to computer-powered quantitative hedge funds have halved this year, reaching their most sluggish pace since 2009.
The firm's recent performance has been a relevant factor in its growth. Per supplemental coverage, Two Sigma's Absolute Return fund gained 3% in March, and its Spectrum fund gained 2.5%, while the S&P 500 fell 5% in the same month. Two Sigma describes itself as a quantitative investment and trading firm that applies scientific inquiry to identify value, and its strategies are described in industry coverage as quantitative with a discretionary overlay.
Industry reporting also places Two Sigma's cumulative results in context, noting roughly $15.2 billion in net gains since inception, which ranks the firm No. 19 among all hedge fund managers, with most of its funds launched in recent years. Taken together, the figures indicate Two Sigma has gained scale while peers face a contraction in new quant allocations, a dynamic that institutional allocators evaluating systematic managers will need to weigh.
The firm's recent performance has been a relevant factor in its growth. Per supplemental coverage, Two Sigma's Absolute Return fund gained 3% in March, and its Spectrum fund gained 2.5%, while the S&P 500 fell 5% in the same month. Two Sigma describes itself as a quantitative investment and trading firm that applies scientific inquiry to identify value, and its strategies are described in industry coverage as quantitative with a discretionary overlay.
Industry reporting also places Two Sigma's cumulative results in context, noting roughly $15.2 billion in net gains since inception, which ranks the firm No. 19 among all hedge fund managers, with most of its funds launched in recent years. Taken together, the figures indicate Two Sigma has gained scale while peers face a contraction in new quant allocations, a dynamic that institutional allocators evaluating systematic managers will need to weigh.
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