Billionaire investor Steven A. Cohen is committing $250 million to a Boston-based investment firm that lets scientists, developers and students submit computerized investment models and then picks the most promising ones to manage the money.

Quantopian, a hedge fund that makes investments with the help of algorithms submitted by thousands of would-be traders, is getting the $250 million in investment capital from Cohen’s venture capital arm Point72 Ventures, the investment firm and Cohen’s family office said in a news release on Wednesday. Cohen is also making an undisclosed investment in Quantopian itself.

Cohen for decades ran SAC Capital Advisors, one of the world’s most successful hedge funds. He now invests his roughly $11 billion personal fortune through a so-called family office and is always looking for new investment ideas.

Forwarding the News

Thoughtful, balanced reporting from the Forward and around the web, bringing you updated news and analysis of the crisis each day.

Terms(Required)

I agree to the Forward's Terms of Service and Privacy Policy

Email(Required)

Investments in computerized models or quantitative strategies have become especially popular this year, and many of these types of firms performed particularly well following stock market turmoil that came after Britain voted to leave the European Union on June 23.

At Quantopian, some 85,000 members from 180 countries are part of an online community where anyone can submit algorithms that might be used deliver market-beating returns. Quantopian pays royalties to people who write models that are selected.

A portion of Cohen’s money, which is the first big chunk of outside cash that will be invested by using its members’ models, will be allocated to Quantopian when certain performance targets are met.

Quantopian’s chief executive, John Fawcett, called Cohen’s investment a “watershed moment for the entire industry” and said he expects it to “propel everyone to new levels of creativity.” Some of the money will be used to make bigger allocations and pay bigger royalties to people who write profitable algorithms.

Point72, meanwhile, will “benefit from an ocean of untapped talent,” at the same time that Quantopian is getting strategic advice from Cohen’s operation, said Matthew Granade, chief market intelligence officer at Point72 Asset Management, who joined Quantopian’s board in 2012.

Cohen was forced to shutter his hedge fund after SAC pleaded guilty to criminal insider trading charges in 2013. He was never personally charged and reached a deal with the U.S. government that would possibly allow him to again manage outside money beginning in 2018.—Reuters

A message from our CEO & publisher Rachel Fishman Feddersen

I hope you appreciated this article. Before you go, I’d like to ask you to please support the Forward’s award-winning, nonprofit journalism during this critical time.

Now more than ever, American Jews need independent news they can trust, with reporting driven by truth, not ideology. We serve you, not any ideological agenda

At a time when other newsrooms are closing or cutting back, the Forward has removed its paywall and invested additional resources to report on the ground from Israel and around the U.S. on the impact of the war, rising antisemitism and polarized discourse..

Readers like you make it all possible. Support our work by becoming a Forward Member and connect with our journalism and your community.

—  Rachel Fishman Feddersen, Publisher and CEO

Join our mission to tell the Jewish story fully and fairly.

$36 $500

$120 $180 Other amount