Study quantifies media biases regarding hedge funds and proposes way for hedge funds to exploit them
| Jul 13th, 2010 | Filed under: Academic Research, Media Coverage of Hedge Funds, Today's Post | By: Alpha Male |
|
Due to the regulatory constraints placed on hedge funds’ ability to market themselves to the public, the media’s interpretation of events takes on a significant importance. While the mass media often takes a dreary view of hedge funds in general, what about the media’s bias in reporting developments surrounding specific funds? Are they overly negative or too lenient? And if they do show a bias, can you use that information to make money?
These are some of the questions addressed in a study by Gideon Ozik of Edhec and Ronnie Sadka of Boston College. The duo uses Google News to collect nearly 70,000 articles containing references to about 750 long/short equity funds in the Lipper-Tass hedge fund database (categorized into: mass media like the WSJ, specialized media like Pensions & Investments, and “corporate media” such as press releases appearing mainly on sites like PR Newswire) . Then they analyze the words contained in these articles looking for positive and negative words (as defined in the widely-used Harvard psychosocial dictionary).
To continue reading this article please login (at the right) or click here to learn more about accessing our archives.
Related Posts
- Study finds market “under-reaction” to Buffett’s 13F filings, proposes trading strategy to exploit it
- Want media coverage for your hedge fund? Think twice.
- Study says big hedge funds have several advantages including economies of scale, alpha, and “well known” auditors
- Hedge funds not bad at reading tea leaves finds new study
- Academic study examines why some hedge funds appear to be fudging valuations
