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TradeSmith Daily

January 2021

How Jim Simons Built the World’s Greatest Quant Fund

January 22, 2021John Banks

Jim Simons, the legendary mathematician, hedge fund manager, and quant, retired a few weeks ago from board chairman duties for Renaissance Technologies (RenTech), the firm he started with partners more than 40 years ago. He is stepping back at 82 years old. Simons and his firm are best known for their Medallion Fund, which first began trading in 1988. The Medallion Fund is the most profitable quant hedge fund of all time. Simons, as chief architect of the Medallion Fund,

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Guest Editorial: Five Tech Predictions for 2021

January 18, 2021John Banks

Editor’s Note: The markets and the TradeSmith offices are closed for the Martin Luther King, Jr., holiday, so today we’re sharing a guest editorial from our friend Jeff Brown at The Bleeding Edge that we thought was particularly insightful. We hope you enjoy these predictions for 2021; we’ll be back tomorrow with our own thoughts on the market and the year to come. Each year, I make predictions about what I see coming in the different areas of technology that

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Scenes from an Epic Market Mania: Bull Raids and Meme Stocks

January 15, 2021John Banks

Speculative areas of the market are not just red hot, they are white hot. Initial Public Offerings (IPOs), a barometer of speculative froth, are on fire. In the past few days alone: Petco Health and Wellness (WOOF) jumped more than 63% on their first day of trading. Poshmark (POSH) saw its share price more than double on the first day. Affirm Holdings (AFRM) nearly doubled on day one, then continued to rise. And of course, two big-name IPOs from December,

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Why a New Commodity Supercycle Could Now Be Underway

January 14, 2021John Banks

Goldman Sachs thinks a new commodity supercycle could be underway. We think they might be right. If they are in fact right — which is easily possible — base metals like copper, along with other commodity staples widely used in construction, vehicles, and home appliances, could be looking at price gains that stretch out over a decade, or even multiple decades. A recent Goldman Sachs research report, published in November 2020, laid out the case for a “structural bull market”

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Bitcoin Will Not Replace the U.S. Dollar (It Will Do Something Better Instead)

January 13, 2021John Banks

As the institutional world starts taking Bitcoin seriously, new questions are emerging. For instance: Will Bitcoin replace the U.S. dollar? Will it push aside major fiat currency competitors? Could Bitcoin usher in a fiat-free world? In our view, the answer is “no” three times over. The destiny of Bitcoin is not to replace or dominate fiat currencies. It is to offer a global store of value, and to put a check on the governments that issue fiat currencies. One of

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When Amazon Prints Your Nikes — Implications of a 3D-Printing Revolution

January 4, 2021John Banks

3D printing — also known as additive printing — is a transformative technology that will usher in dramatic change. The disruptive dominance of 3D printing, which is closer than most realize, will be a hallmark of the transition to mankind’s fourth great age, the information age. (The prior three were the stone age, agricultural age, and industrial age.). This might sound funny, because investor excitement around 3D printing peaked about seven years ago. You can see it in the share

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The Crucial Differences Between Monetary Policy and Fiscal Policy

January 1, 2021John Banks

Editor’s Note: As we finally enter 2021 — goodbye forever, 2020! —  the old Wall Street phrase “Don’t Fight the Fed” could be recast as “Don’t Fight the Fiscal.” With government spending set to dominate the investment look for years to come, the final installment of our “best of” series revisits the difference between monetary policy measures and fiscal ones. Happy New Year! –JCL October 2020 was an ugly month for the U.S. stock market. The Dow Jones Industrial Average,

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