When it comes to hedge fund research, there used to be a time when getting your hands on the right information was a challenge. However, those days are long gone due in large part to the Internet.
With all this in mind, you need to focus your time and attention on the research that is going to do the most for your investment strategy. In other words, you don’t want to get bogged down with details that don’t matter.
Hedge Fund Education Center
Our hedge fund education center is meant to better educate you as to why we track hedge funds, how to use this information to your advantage, and much more.
It is in our education center that you will find all the following:
1. How to Beat the Market by 20 Percentage Points
2. Challenges with Imitating Hedge Funds
3. Hedge Fund Net Returns vs. Gross Returns
4. Why you should Dump your Hedge Funds
SEC requirements
It’s important to realize that hedge funds with assets under management in excess of $100 million are required by the SEC to file a quarterly 13F form, detailing all of their long equity holdings and option positions. Hedge funds have a 45-day “grace period” after the end of each quarter to file 13Fs, and most–except for Ken Fisher and a few others–choose to wait until the clock says midnight, so to speak.
The information tracked by Insider Monkey and other 13F-centric sites is primarily equity positions, and does not include all fixed income positions, commodity plays, currency bets, or short positions. So, it’s best to understand that one can study how a money manager chooses stocks to begin their hedge fund research, but to discover a Warren Buffett‘s or a George Soros‘s full macroeconomic view, it’s also crucial to look at hedge fund letters and interviews.
Now, we also must point out that if a hedge fund is a large shareholder in a certain company–typically they must own more than 5% of common stock outstanding–the SEC also requires that 13D or 13G forms are filed at the moment positions are changed. This is how we know when Carl Icahn might choose to go “activist” on a certain company, or when Dan Loeb wants to push for turnover in a board of directions by buying more shares of a stock.
Who to watch
While the best performing funds can and will change on a regular basis, here are the five that are currently at the top of the industry. Total values given are of equity portfolios only:
1. Fortress Investment Group. Total value: $2,097,006,000
2. Sprott Asset Management. Total value: $294,671,000
3. Dafna Capital Management. Total value: $16,416,000
4. Artis Capital Management. Total value: $144,489,000
5. Palo Alto Investors. Total value: $414,658,000
Who you might want to stay away from
This information may not be that exciting, as you don’t want to follow in the footsteps of these hedge funds, but you can still learn a lot about your strategy including what to avoid. As you browse our list of the worst performing hedge funds, pay close attention to the following details:
a. Number of stocks
b. Total value
c. Monthly return
As you dig deeper, you can also learn more about the top holdings for each of these hedge funds, such as Tontine Asset Management. When reviewing this information, focus on:
a. Number of shares
b. Value
c. Activity
Final Note
There is a lot of information out there on hedge funds, some of which is going to be useful while other details will have nothing to offer somebody in your position.
The more time you spend conducting hedge fund research the more you are going to learn. If nothing else, you can put yourself on the right track by paying close attention to our education center as well as our updated list of best and worst performing funds.
