Hedge Fund Investing
How hedge funds actually pick stocks, why their best ideas are surprisingly accessible, and how to use what they disclose.
Hedge funds are the most-misunderstood category in investing. The popular picture is a few brilliant traders staring at six monitors, making split-second decisions on stock movements. The reality is structured, slow, and far more disciplined than the popular picture suggests. The strategies that actually compound capital across decades are not secrets. They are well-documented and, in many cases, accessible to individual investors who know what to look for.
This is the cluster of articles we publish on hedge fund methodology, the SEC filings they have to make public, and the patterns that separate the funds that generate real alpha from the ones that ride a benchmark. Read them in order if you are new to the topic. Skim by title if you already know the basics and want our specific take.
Recommended reading order
5 articles, ordered for sequential learning. Skim by title if you already know the basics.
- 1How Hedge Funds Actually Make Money (It's Not What You Think)
The five strategy categories. Where the alpha actually comes from. Why most of it can't be copied — and where the patterns that CAN be copied live.
Read → - 2How Hedge Funds Decide What to Buy (and Sell)
The structured idea-generation, diligence, sizing, and risk-management process behind a single position. A plain-English walkthrough.
Read → - 3What Is a 13F Filing? (And Why Smart Investors Read Them)
The quarterly SEC disclosure where every institutional manager over $100M lists their long holdings. What they tell you, what they hide, how to use them.
Read → - 4The Best Stock Pickers of All Time (And What They Got Right)
Buffett, Druckenmiller, Klarman, and a dozen others. Who actually has the long-term track record, and what they share.
Read → - 5Hedge Fund Fees Are 2 and 20. Ours Are Different.
Two percent of assets per year, plus twenty percent of profits. The math is unkind across decades. The alternative is a publisher model.
Read →
Core 20
The core 20 model portfolio applies the methodology this topic covers. 14.7% CAGR over the backtest, +2.2% alpha vs the S&P 500.
Explore Core 20→The Market Normality Report
Where today’s S&P 500 sits in 75 years of history. Twelve brand-designed pages. Print-ready. Free.
Get the report →