The Problem With Hedge Fund Databases

How reliable is the information hedge funds self-report to commercial databases? New research confirms what has long been suspected: While they shed some light on performance, databases are inherently flawed.

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Hedge funds aren’t legally required to report to commercial databases, and many choose not to in order to protect their strategies. But some do, especially small- and medium-sized and younger funds that use reporting as a form of marketing.

Many of these databases allow funds to report their own figures.

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