If someone offers you a 35% return and they aren't the Renaissance Medallion Fund, you should probably do your due diligence.
https://en.wikipedia.org/wiki/Renaissance_Technologies#Medal...
The red flag to look out for is extraordinarily low variance of returns, not extraordinarily high mean of returns. Madoff never promised more than about 12%, but he promised to be within 1% of that all the time. If you look at RenTech's Medallion returns since 1988, they're consistently between 30% and 120%. They're not slamming down the same percentile every year.
It's one thing to beat the market - it's still an incredibly difficult feat to do it consistently, but there's an element of chance involved. You won't beat by the same margin every year, even if you do beat every year. If you're hitting similar returns year after year, that implies your work is completely decoupled from the inherent randomness of market dynamics.
Bona fide lack of access for outside investors is probably a strongly positive signal in this industry.
Another investor is another person you have to have a relationship with.
Either they're full of shit, or you're about to learn about some new breakthrough that everyone will be using in the future (unfortunately some of the former will claim to be the latter).
Suppose Rentech started with $50M AUM in 1994 (reasonable assumption for a small hedge fund); 50M * (1.718)^20 = 2.51 Trillion in 2014. What am I missing here?