Research shows hedge fund managers not just overpaid, blindfolded dart-throwers
| May 24th, 2010 | Filed under: Hedge Fund Industry Trends, Performance, Analytics & Metrics, Today's Post | By: AAA Staff |
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Questioning whether a hedge fund manager is any good at picking stocks is a bit like questioning whether Wayne Gretzky knows how to skate or Lance Armstrong knows how to ride a bike. By and large, Wayne, Lance and most alternative investment managers would find the question just a bit insulting.
Lucky for them, research by Wesley Gray of the University of Chicago and Andrew Kern of the University of Missouri affirms that they certainly are good at picking stocks and not just absurdly lucky.
Indeed, the paper entitled Do Hedge Fund Managers Have Stock-Picking Skills summarizes the authors’ clinical study of investment recommendations submitted to Valueinvestorsclub.com (VIC), a private-access club with a membership base consisting primarily of smaller fundamentals-based hedge fund managers and their associates.
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