While a long-running feud between Two Sigma Co-Founders John Overdeck and David Siegel was making headlines last year, the secretive quant major was quietly generating steady returns for its investors, according to a report by Business Insider.
The report cites an unnamed source as revealing that the $60bn firm’s two core strategies – the Absolute Return Enhanced fund, and the Spectrum Fund – returned 12% and 8.6% respectively over the course of 2023, largely on a par with with annual performance at other hedge fund majors including Citadel, Millennium, and DE Shaw.
According to investor documents, the Absolute Return Enhanced fund, which invests in multiple strategies but historically has leaned into systematic equity market neutral trading, had an annualised return of about 10% through late 2022.
As well as the feud between Overdeck and Steel hitting the headlines when the firm disclosed in a securities filing that their relationship was threatening the company’s business prospects, Two Sigma also made the news when it disclosed that the actions of a ‘rogue trader’ caused $170m in client losses as well as gains for other investors.
