I think this posts misses the most important piece, the real secret sauce, which is how do you sift through massive streams of data and separate the signals from the noise? And how do you do so continuously so that as soon as an edge evaporates you don't keep trading it?

I think the key insight they made here is much less sophisticated than many think. The usual guess is that all these math geniuses have some magic statistical models that tell them the answer, but I don't think that's it. There are known, good ways to detect these things, and most (if not all) hedge funds are aware of them.

I think the magic is in the systems engineering they have done. It is a system which is able to evaluate the quality of a signal as it would be traded. Traditionally, quants come up with models that they then backtest to "prove" before doing live trading. A lot of models that look great on paper, or on historic data, fall flat in real-world trading. Hedge funds spend significant time and resources on quality back-testing data and systems, and I think Renaissance has been able to take this to a whole new level.

This is all mainly a guess on my part, but based on the book The Man Who Solved the Market, which alludes to this system without going into details (obviously). It is much less exciting than some super sophisticated ML models or what-not that people imagine is the source of their success.

This post focuses on the leverage, which is great for goosing the returns, but isn't the whole story. Put another way, if you could magically be gifted some part of Ren, which you rather have their special leverage arrangements, or the signal vs. noise oracle?