The Hedge Fund That Wasn’t Illustration by Jeremy Leung/II Bruce Shi of Thrones Capital claims in Forbes to be one of the most successful investment managers in the world. An investigation by columnist Angelo Calvello suggests he’s something else. By Angelo Calvello September 03, 2019 There is nothing better than a hedge fund mystery, and this one has it all: Fast cars, prestigious academic achievements, a glamorous man of mystery, and, to sweeten the pot, a heavy dose of artificial intelligence. Forbes article. It begins with a series of non sequiturs on AI and investing (“Algorithms analyze the history of risk cases and identify early signs of potential future issues”) and then devolves into a mawkish paean to “Dr. Bruce Shi” and Thrones Capital, the “top hedge fund company” he founded — which “combines real-time market data provided by the company with an advanced learning engine to identify patterns in price movements for high-accuracy market predictions.” Who is Dr. Bruce Shi, and what is his Thrones Capital? A quick web search revealed a July 28, 2019, article on Entrepreneur fawningly entitled “Bruce — The Inspiring Journey of a Young Entrepreneur,” in which the unidentified author tells us: The founder of Thrones Capital — Bruce Shi — drives a Lamborghini, walks to his office with Palo Alto Network co-founders, and lives in the Dragon Vein of the Silicon Valley, where all the rich and powerful people live. A neighbour of Zhiyuan Yang, founder of Oracle, and many other top business moguls, Bruce Shi is a mysterious character who founded Thrones Capital at the age of 30. At present, the company is one of the most promising AI hedge funds in the world. The genesis of these articles seems to be a March 17, 2019, press release entitled “Thrones Capital Led by Bruce Shi Launched the AI Trading Hedge Fund.” The release contains a trove of information on Shi and the sometimes named “AI Trading Hedge Fund” (the press release later calls it the “Artificial Intelligence Quantitative Trading Fund”). For example, Bruce launched the fund in 2017. It has about $20 million in assets under management and “has maintained solid performance for the past three years, with steady growth, high returns and adequate risk control measures.” Most interestingly, the error-ridden press release includes this summary of the company’s investment process: Thrones Capital targets capital growth and trading the US stock market index. The fund takes risk control as its top priority and draws the maximum benefit within the controllable risk range. The fund combines short-term trading, medium-term trend, and fixed-income strategy. It combines trend and value investment, and optimizes the combination into high-return, low-return, stable-revenue, and low-risk investment products. Thrones Capital strategy leverages artificial intelligence and big data analytics with supervise learning and reinforcement learning algorithms. The artificial intelligence engine learns historical market data and real-time market data, dynamically optimizing trading model. The fund’s goal is to obtain higher annualized return under the premise of controlling risk. What does this fund not do? The kicker is the claim that Thrones is using reinforcement learning algorithms. There are only a handful of companies in the world that have created commercially viable reinforcement learning applications — and there are fewer still in the asset management industry. Thrones website and discovered that the site cannot be reached. This, of course, only goaded me on. Down the rabbit hole I went, pursuing two lines of inquiry. First, I contacted anyone that might be affiliated with Shi or Thrones. à la Jeffrey Epstein, he was likely paid by Shi or a proxy to write the story, or simply paid to publish the story under his byline. This is a real possibility because, as one critic has written, “just about anyone could get to be a Forbes contributors [sic]. Forbes never edits those contributor posts.” (Full disclosure: Although I am an independent columnist for Institutional Investor, not a staff reporter, every column I write is vetted, edited, and approved by II’s staff before publication.) I sent a note to the editor-in-chief of Entrepreneur asking for the contact information of the unidentified author of the “Bruce” article. No reply. I’m guessing the piece is another instance of pay-for-play media, and it was probably written by the same person who wrote the March press release. I contacted several individuals who, in their LinkedIn profiles, appeared to be current or former Thrones Capital interns or employees. No reply. Hua Luo Geng International Golden Cup Mathematics Competition is considered one of the toughest math contests in mainland China, I could not verify Shi’s victory. But does it even matter? After all, this is a competition for primary school and junior high school students; claiming victory would be like Izzy Englander putting his PSAT score in his CV. I did find the International Olympiad in Informatics and the International Mathematical Olympiad — neither of which lists Shi as a winner — but no mathematics and information technology Olympiad. The press release also states that Shi won “the Best Paper Award at IEEE for one of his papers published in 2016 during his Ph.D. program.” The Institute of Electrical and Electronics Engineers is indeed a prestigious organization in the AI world, and though I found three papers on its website listing Bruce as a co-author (along with six or more other co-authors), I uncovered no evidence that his 2016 paper had won an award. In fact, there were two papers with 2016 publication dates; one was cited just once, the other five times. Logic would suggest that the winner of “the Best Paper Award at IEEE” would certainly have been cited more frequently. articles of organization to the California secretary of State. Shi is listed as the LLC’s “one manager” and is the signatory; Thrones Investment’s business address is 2543 Borax Drive, Santa Clara, California. Let me pause to clarify something here: Thrones Investment LLC is Shi’s legal corporate entity; it does exist and is still registered with the state of California (although there seems to be some funkiness associated with its most recent filings). According to those documents, its “type of business” is “Investment and IT Services.” Thrones Capital claims to be an “AI Quantitative Hedge Fund,” although I could find no independent documents or evidence of this entity’s business or regulatory registration or commercial activities. Instead, a web search for Thrones Investment LLC led to the Apple app store and the free “BAHappyHour” app, which “allows San Francisco Bay Area users to find restaurants nearby and get happy hour information.” Thrones Investment is listed as the seller and copyright holder. Video: Looking to Diversify? Here’s the Smart Way[/paste:font] As of August 4, 2019, the app had exactly one five-star review. Thrones Investment was also identified as the developer of another free app, “Thrones Capital AI Hedge Fund,” with this clumsy description: “The Fund is based on automatic trading system and supervised under experienced trader. The auto trading system leverages market historical data and advantaged machine learning, reinforcement-learning algorithm.” the EB-1 is a preference category for United States employment-based permanent residency. It is intended for ‘priority workers.’ Those are foreign nationals who either have ‘extraordinary abilities,’ or are ‘outstanding professors or researchers’ . . . [including] applicants who can demonstrate their extraordinary ability in the sciences, arts, education, business, or athletics through sustained national or international acclaim.” Specifically, I am guessing that Shi is shooting for an EB-1A visa, which “requires the petitioner to show that the individual has either won some major award (Nobel Prize, for example) or met at least three out of ten regulatory criteria and show that the individual has ‘risen to the very top of the endeavor with national or international acclaim.’” Three of those criteria that Shi’s activities clearly are meant to satisfy, as listed on the U.S. Citizenship and Immigration website, are: “Evidence of receipt of lesser nationally or internationally recognized prizes or awards for excellence.” The IEEE prize in 2016; the Hua Luo Geng and Olympiad victories: Check. “Evidence of published material about you in professional or major trade publications or other major media.” The Forbes and Entrepreneur articles; newswire stories in Yahoo Finance and other outlets: Check. “Evidence of your authorship of scholarly articles in professional or major trade publications or other major media.” The three IEEE papers: Check. And like any other individual with extraordinary ability, Shi made sure to meet a fourth criterion: “Evidence that you command a high salary or other significantly high remuneration in relation to others in the field.” The brand-building claims that Shi is the founder of “one of the most successful hedge funds in the world” and that he drives a Lamborghini and lives in a ritzy neighborhood: Check. I put this visa theory to an immigration attorney who assists Chinese clients, many in the IT space, with their EB-1A applications. Although she does not know Bruce Shi, she said he is following the classic EB-1A playbook: Get as much national or international media as possible, demonstrate you’ve won some academic prizes and published some papers in academic journals, hint at your material success, and make clear that you perform “a critical role in a distinguished organization.” Yet she believed that the inconsistencies and deceit I uncovered would likely not be detected by government adjudicators. For example, they would likely ask Shi for a copy of his Ph.D. diploma but not contact CMU; they would not know that Thrones is not “one of the most promising AI hedge funds in the world”; and they would not seek to validate Shi’s various claims of scholastic exceptionalism. And as the attorney importantly pointed out, an EB-1A is the only visa that allows for self-petition. Of course, I could be way off-base in my theory. But given the evidence amassed to date, it seems like the most likely explanation. To repeat, I did give Shi and his associates several chances to set the record the straight — but again, no reply. For now, if you know Bruce Shi or Thrones Investment LLC, please contact me and tell me your story. If you can find Thrones Capital or “AI Trading Hedge Fund” in your manager database, send me the information. Like I said, there is nothing better than a hedge fund mystery.
another possibility is that bruce shi may use western media coverage to seek opportunities in china. this is because if the most leading hedge fund industry has recognized him, he can use this credit and reputation to sell his story in china, and establish his business there.
Is the impressive historical track record audited? These are numbers that one cannot fake when independently verified by 3rd-party auditor.