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  • Writer's pictureMatt DeLong

How do you determine which companies the hedge funds are buying?

How do you hitch a ride on the way up, or down?

Nothing is automatic! It’s this kind of shortcut to success people always look for and that makes people thinking trading is easy, it’s not!

Hedge funds that own large positions of a public company (5% or more) file a 13D w/ the SEC, but after they have built their position. So, by the time it’s public information, they have already bought in. Keep in mind that the market is a combination of everyones buying and selling orders, not just any one hedge fund on a solo basis, and keep in mind that nothing is automatic.

Buying a large position in a company doesn’t automatically make the price go up, unless they buy up 100,000,000 shares in a short period of time, thats why it takes many weeks or months to build a position (unless they are using a dark pool), so their own buying doesn’t sabotage their average cost.

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