About High-Conviction Buy (HCB)

Strategic Insights

HCB is designed to capitalize on the wisdom of top-performing hedge fund managers.

To enable effective investing alongside these top managers, the HCB strategy is built upon a substantial and diverse data pool of stock market information and investment portfolios of thousands of investment funds.

While some hedge fund managers may perform worse than the market, it's fundamentally important to understand that the HCB strategy isn't about leveraging what average hedge fund managers do. Rather, it systematically identifies the top-performing managers, 1% of thousands, and presents timely invest-alongside opportunities based on their successful investment decisions.

One of the main components of HCB backend is the extensive data aggregation and analytics spanning multiple decades of SEC Form 13F Reports. While some individual investors, particularly day traders, may find SEC Form 13F reports somewhat delayed, for those focusing on long-term fundamentals over short-term fluctuations, these reports, coupled with a required 45-day reporting window, offer unbeatable investment insights and ideas. The HCB method strategically leverages the 45-day timeframe as a compelling safeguard to seamlessly integrate the 13F reports with current market data, empowering users to make well-informed investment decisions.

For the past decade, HedgeMind has consistently applied the HCB strategy with great success, achieved performance on par with the most successful hedge fund managers.

HCB Performance Showcase

Best Invest Alongside

Today's HCB Stocks

How It Works

You

Your Stock

Your HCB Manager

Your
Stock

Your
HCB Manager

Invest Alongside the Best

Invest with Confidence

Is this simple strategy right for you?

Yes,

if you are a fundamental and long-term investor,

if your investment objective is to outperform yourself,

if you believe learning by investing alongside

top-performing hedge fund managers

is the quickest way to grow your

stock investment skills.

Do you have any particular stocks in mind?

If not,

Why not explore Today's HCB Stocks, a list of stocks you can buy now at prices lower than the top-performing hedge fund managers paid.

Depending on your investment preference, you may also find compelling ideas from browsing through the lists of Stock Ideas.

For a given stock you are considering

Once you have decided on a stock, HCB is at your disposal.

The HCB method is powered by HedgeMind’s proprietary recommendation engine, constructed upon our deep knowledge of 1,000+ hedge fund managers and enhanced by our constantly evolving cutting-edge machine learning data analytics.

The recommendation engine will do all the heavy lifting for you. It identifies top-performing hedge fund managers who are the best to invest alongside for your particular stock.

Try it now

Discover the best to invest alongside

Knowing your interest in a particular stock, the engine will provide up to three managers, often with one labeld

Recommend

, for you to choose from.

Experienced users typically select the recommended manager and move on to the next step.

Nevertheless, you may take a moment to compare the managers based on the ratings that the engine provides, using the criteria as detailed below.

Performance, rated on a 0-5 Star scale, reflects how successful a manager's portfolio performs relative to the market, in both short-term (1-Year) and long-term (3-Year). A 4-Star or higher Performance indicates that the manager has outperformed the market.
Investment Conviction, rated on a 0-5 Star scale, an indicator we have specifically constructed, through comprehensive data analytics efforts, to reflect the strength of confidence that a manager has in a particular stock investment. High-Conviction corresponds to an Investment Conviction rating of 4-Star or higher.
Easy Alongside, rated on a 0-5 Star scale, an indicator we have formulated to project the easiness of investing alongside a manager.
In general, it's easier to invest alongside an investor with longer stock holding periods, such as Warren Buffett, instead of Stanley Druckenmiller.

Analytically, our machine learning research finds that the stock holding time is primarily influenced by the manager's investment style and specifically his position size.

A 3-Star or higher Easy Alongside indicates that the manager will likely hold the position for at least one year, projecting a sufficiently long opportunity for you to invest alongside using the 3 Simple Rules of HCB.

In addition to the above criteria, it's always essential to keep the following in mind:

Purchase Price
To adhere to Rule #2 of the 3 Simple Rules, when you buy, you buy at a price lower than what your selected manager paid.
Risk Control
Our research reveals that top-performing hedge fund managers typically maintain an average weight of around 5% for their top 10 stocks within their portfolios. You can effectively manage your position risk by keeping the position weight under 5% of your portfolio or align it with that of your chosen manager.
The importance of "No HCB manager found"
On certain stocks, the engine may tell you "Currently, no HCB manager found for your stock".
Top-performing hedge fund managers don't simply buy random stocks; they opt for certain stocks based on their proprietary research and successful investment experience, while also forgoing others. Therefore, it is equally important to recognize the lack of interest from these managers in a stock as it is to leverage their strong interest in a stock.

Your
Stock

Your
HCB Manager

Now you are investing alongside your HCB manager

No more emotional trading.

Especially for individual investors, volatile market periods often trigger emotional responses, leading to impulsive investment decisions driven by fear or greed.

Having your stock attached with a HCB Manager, who is a highly seasoned professional, your focus should be to simply keep tracking his/her latest trading activities.

Keep When to Buy and When to Sell rules in mind, observe how your HCB manager buys or sells to change the position size, and adjust yours accordingly.

Invest with confidence

Trust the process.

Your HCB manager, one of the top-performing hedge fund managers, makes decisions based on his/her powerful collection of professional experiences and resources. Investing alongside your HCB manager helps you become less emotional, more patient and disciplined.

In other words, HCB enables you to invest in stocks with confidence. This confidence enhances your focus, making you less susceptible to short-term market fluctuations, and develop a long-term perspective for success.

HCB

Top-Performing Managers

HCB means you systematically invest alongside the top-performing hedge fund managers. It is a simple, disciplined, and proven way of making money in stocks.

In the past decade, HedgeMind has consistently applied the HCB strategy with great success, achieved performance on par with the most successful hedge fund managers.

Performance	Number of Positions	Average Return	Number of Gainers	Average Return	Number of Losers	Average Return	Success Rate	Gain/Loss Ratio
HCB The results are based on the closed positions of the High-Conviction Buys list.	278	32	176	70	102	35	63	1.99
Alex Sacerdote WHALE ROCK CAPITAL MANAGEMENT LLC Based on the closed stock positions that Sacerdote held for one year or longer.	189	39	142	59	47	24	75	2.47
Stanley Druckenmiller DUQUESNE FAMILY OFFICE LLC Based on the closed stock positions that Druckenmiller held for one year or longer.	178	19	126	39	52	28	71	1.41
David Tepper APPALOOSA LP Based on the closed stock positions that Tepper held for one year or longer.	167	17	121	31	46	19	72	1.64
Julian Baker BAKER BROS ADVISORS LP Based on the closed stock positions that Baker held for one year or longer.	339	11	150	88	189	50	44	1.74
Brad Gerstner ALTIMETER CAPITAL MANAGEMENT LP Based on the closed stock positions that Gerstner held for one year or longer.	96	26	54	73	42	34	56	2.12

Frequently Asked Questions

What are the key benefits of using the HCB method?

By creating a one-on-one link between your specific stock and a particular top-performing hedge fund manager, HCB enables you to experience the following benefits:

Access to Expertise: Hedge funds often employ highly skilled and experienced investment professionals who conduct in-depth research and analysis. By investing in stocks that hedge funds have identified as attractive opportunities, individual investors can leverage the expertise and insights of these seasoned professionals.
Enhanced Research and Due Diligence: Hedge funds typically have dedicated research teams that thoroughly analyze potential investments. By piggybacking on their research, individual investors can benefit from the extensive due diligence conducted by these professional teams, potentially saving time and effort in conducting their own research.
Alignment with Successful Strategies: Hedge funds with a strong track record have often developed successful investment strategies. By investing in stocks that align with these strategies, individual investors can potentially benefit from the same factors and investment themes that have contributed to the hedge funds' success.
Increased Confidence in Stock Selection: When top-performing hedge funds make significant investments in specific stocks, it can be an indication of their conviction in the investment thesis and the potential for future gains. By following their lead, individual investors can gain increased confidence in their own stock selection and potentially improve their investment outcomes.
Potential for High Returns: Hedge funds aim to generate above-average returns, and their investments often target companies with high growth potential. By investing alongside top-performing hedge funds, individual investors can potentially benefit from the growth trajectory of these stocks and have the opportunity to achieve attractive returns.

Additionally, the most important benefit is that, by enabling a disciplined experience of investing alongside the best, HCB helps you navigate volatile markets with greater confidence and potentially achieve long-term investment success.

What sets the HCB method apart from other stock investment approaches?

Is the HCB method good for individual investors?

What do I need to know to get started?

Are there any limitations or potential challenges associated with the HCB method?

What if I don't know what stock to start with?

What if I want to invest alongside Warren Buffett?

Are there any winning examples related to the application of the HCB method?

Are there any additional fees associated with using the HCB method?

Disclaimer

HedgeMind.com is not a registered investment adviser or a broker/dealer. Users are advised that content is provided for educational, informational, entertainment and research purposes only and should not be construed as an offer to sell or the solicitation of an offer to buy securities and is not intended to be, nor does it constitute, investment advice or recommendations. In no event will HedgeMind.com or its members, managers, directors, officers be liable to you or any third party for any damages of any kind arising from your use of any content or other material published or available on HedgeMind.com, or relating to the use of, or inability to use, HedgeMind.com or any content, including, without limitation, any investment losses, lost profits, lost opportunity, special, incidental, indirect, consequential or punitive damages. The information on this site is in no way guaranteed for completeness, accuracy or in any other way. Past performance is no guarantee of future results. Investment information provided may not be appropriate for all investors and is provided without consideration of your financial sophistication, financial situation, investing time horizon, or risk tolerance. If you invest based on the information provided on HedgeMind.com, it means that you accept terms and conditions of use of HedgeMind.com. You are responsible for any your own actions and are urged to consult with your own independent financial advisers with respect to any investment.