July 26, 2018

Darts Outperform The Best Hedge Funds

And here's why: as Jakab reports, "at the time of the conference, Heard on the Street columnists took on the stock pickers by throwing darts to create a portfolio of 10 stocks to go up against the 12 stocks picked by the Sohn speakers."
Readers an probably guess where this is going:
Three months later, the darts have prevailed. The Heard team’s 10 picks, eight long and two short, have returned 7.23% on average. The combined performance of 12 picks by Sohn attendees has been slightly negative, lagging behind the S&P 500 by more than 6 percentage points.
What were some of the names the best and brightest in the business could come up with? The top "expert" pick belonged, ironically, to former Facebook exec (and current critic) Chamath Palihapitiya who said to buy Box. Since than it is up 16% which is great... until one compares the top 5 dart returns.
The top pick from the darts was railcar leasing company GATX , up 27% in the past three months.
The other dart "picks" were PagSeguro, Paychex, Park Hotels and Four Corners, all of which have outperformed their respective "2 and 20" recos.

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