Study finds ‘significant’ crowding in hedge funds

New research links herd investing to bigger drawdowns in stressed markets


Hedge fund managers may be ignoring one of the golden rules of investing: don’t follow the herd. 

A new study from Greg Brown and Christian Lundblad of the University of North Carolina, Chapel Hill and Philip Howard of Wake Forest University suggests hedge funds are more exposed to crowding than previously thought.

The researchers measured crowding in long positions by looking at the regulatory filings of 1,466 hedge fund managers in the US from 2004 to the end of 2016.

To gauge crowding

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