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How humans outperformed the machines in 2020 at $6 billion Schonfeld Strategic Advisors

Summary List PlacementIn a reflection of the overall industry's 2020, the humans at $6 billion Schonfeld Strategic Advisors outperformed the machines. Schonfeld's $2.3 billion Fundamental Equity fund, which includes dozens of stock-trading teams but no quant strategies, made 14.% in 2020 thanks to a 4.4% return in December, according to...

Steven Schonfeld, Ryan Tolkin, Andrew Fishman

Summary List Placement

In a reflection of the overall industry’s 2020, the humans at $6 billion Schonfeld Strategic Advisors outperformed the machines.

Schonfeld’s $2.3 billion Fundamental Equity fund, which includes dozens of stock-trading teams but no quant strategies, made 14.% in 2020 thanks to a 4.4% return in December, according to a fact sheet the firm sent to investors seen by Insider. The only month the fund lost money was in March, when it fell by 4.3%. 

This performance beats Schonfeld’s flagship fund, the Strategic Partners fund, which runs nearly $4 billion. That fund returned 9.8% in 2020, according to a recent Bloomberg report, and made 4.8% in December. 

The firm declined to comment on performance. 

See more: Here are under-the-radar hedge fund managers who crushed 2020, including a new launch from a former Viking Global portfolio manager and a comeback from a one-time Goldman partner

The Strategic Partners fund includes the firm many quant strategies as well as fundamental stock-pickers. The firm was not immune to some of the troubles that quant funds ran into last March, when it fell by more than 10% thanks to the volatility from the pandemic. Major quants like Bridgewater, Renaissance Technologies, and Winton Group never recovered from the tough first quarter, and lost money on the year. 

Human-run stock-picking strategies had a banner year though. Managers like D1 Capital, Coatue, Tiger Global, and more put up massive returns, fueled by gains in growth stocks and private market companies. 

Schonfeld’s Fundamental Equity fund, which the firm was fundraising for last year, beat the average hedge fund, which made 11.6% on the year, according to Hedge Fund Research.

Between its flagship fund and the fundamental-only strategy, Schonfeld raised $1 billion, according to a Bloomberg piece from last summer. 

Insider obtained a copy of the fundraising pitchdeck the firm was using for the Fundamental Equity fund last year, and the 24-page pitch ran through fees, team composition, and strategy goals. The fact sheet sent to investors recently does show a small difference from the pitchdeck — the sector with biggest chunk of the portfolio now is financials at 18% followed by information technology, which used to be the largest sector exposure.  

SEE ALSO: Schonfeld is raising money for its $2.2 billion fundamental equity fund. Here are the highlights of its 24-page pitch to investors laying out fees, performance, and personnel.

SEE ALSO: Billionaire Seth Klarman’s Baupost returned less than 5% in 2020, failing to break double-digits returns in what’s been called the best year for hedge funds since 2009

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