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Hedge Fund Best Ideas

Epsilon Asset Management has published a research paper on the stockpicking of Hedge Fund managers. We do this through a thorough analysis of their regulatory mandated Form 13-F filings for over two decades. We present new evidence of true stock picking skill across hedge fund managers. Through our unique data capture, we are able to disaggregate hedge fund long-equity portfolios for the purpose of teasing out their Best Ideas. We hope you find this report insightful and informative.

An Examination of Stockpicking Ability

Countless industry conferences and dinners are devoted to “Hedge Fund Best Ideas,” while fund managers are popularly lionized as stock picking gurus. Epsilon Asset Management has partnered with Professor Andrew Papanicolaou to produce a comprehensive quantitative study that examines the regulatory mandated portfolio positions of nearly 1,500 hedge funds from 1999 to 2018. We seek to quantify the stock picking skill of these vaunted managers and to see whether their Best Ideas truly outperform the market and deserve the attention they receive.

Download Our Study

Hedge Fund Best Ideas

We calculated nine different methods for eliciting a 'Best Idea' from a portfolio of positions. We tested to see if those Best Ideas outperform the other positions in a fund manager's portfolio. What we found was startling.

2021 Addendum

To commemorate the publication of our academic report by the Journal of Portfolio Management, we updated the period of our origianl analysis, which ended in 2018. Download this complimentary addendum for analysis on hedge fund Best Ideas from 2019 to 2021, a challenging period for hedge fund stock selection.

Download the Addendum

Dive Deeper


For those technically inclined, we’ve posted portions of our research in code on our Github. Click through, explore the actual regression analyses, and take a look at statistical output and time series charts for dozens of unpublished studies.

View Our Repository


For those academically inclined, you can read the peer-reviewed academic research at the Journal of Portfolio Management.

Academic Paper



The information contained in this research piece was obtained from various sources that Epsilon Asset Management, LLC (“Epsilon”) believes to be reliable, but Epsilon does not guarantee its accuracy or completeness. The information and opinions contained on this site are subject to change without notice.

Neither the information nor any opinion contained on this site constitutes an offer, or a solicitation of an offer, to buy or sell any securities or other financial instruments, including any securities mentioned in any report available on this site.

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