Prestige of P72

AtticuSFincg:

Point72 used to be called SAC Capital. Unless you are a finance hardo since birth, you probably don't know a ton about SAC Capital. If you google it, you will undoubtedly come across why SAC Capital no longer exists and why Point72 is a family office.

SAC Capital used to be one of the most elite hedge funds in the world. The place generated returns like no other and I honestly can't think of a single firm that charged fees as ludicrously high as SAC Capital. They vary per client but I've seen old reports that showed them as high as 3.5/30. After fees, rumor was that for awhile, SAC generated something like 30% net annualized which again is amazing and also only comparable to very few asset managers. (The 30% is more rumor than fact as I haven't seen an actual tearsheet with that number, but rumors from other people). The reason the firm generated returns like this was for two reasons 1) they hired really smart people 2) insider trading. SAC Capital took advantage of the expert network craze and effectively figured out how to easily find people with insider information about companies. SAC traded generally more on earnings and had high portfolio turnover unlike a true long-term value fund. If you are interested in learning more about the history I suggest you read Black Swan or there is also a New Yorker article about Matthew Martoma (former SAC PM).

Undoubtedly, not all of the performance was from insider trading, but that allowed them to get that extra juice so the returns were high enough to charge those exorbitant fees. There are very few hedge fund managers who have as much money as Steve Cohen, the only other off the top of my head is George Soros (not including Warren Buffet because he does buyouts as well).

Anyways, Point72 has a lot of the same higher-level staff that SAC Capital did. Returns are lower, but still decent (~8-15% a few years, one year was closer to 0%). For whatever reason, probably something to do with Steve Cohen's ego and planned comeback, he continued to pay exorbitant salaries to his PMs.

From a junior perspective, P72 is a great place to work for a few years. However, know that it does have a stink. There are a few people who I've spoken to that flat out won't hire someone who worked at P72, but obviously that's not everyone. Your experience will be very hands-on and you will learn a lot, while outearning your peers even at EB's like EVR or PJT.

Isn't Bobby Axelrod based on Steven Cohen?