Advice from the gurus of Wall Street may be less valuable than their acolytes would like to believe. Any investors who bought on the basis of tips from one of New York’s most celebrated hedge fund conferences last year would have spectacularly failed to beat the market.
The Ira Sohn Investment conference held at New York’s Lincoln Center brings together the leading lights of the hedge fund community to share market insights as a way of raising money for cancer research.
But a Financial Times analysis of last year’s tips shows mixed results. An investor who followed every top idea from the 12 speakers last year would have made 19 per cent, less than the 22 per cent gain available from a passive index fund tracking the US stock market. Many of the ideas proved to be duds, including some from the most high-profile managers – David Einhorn of Greenlight Capital and Bill Ackman of Pershing Square – who will appear at this year’s conference today.