Peter Rudegair of The Wall Street Journal examines the success of Hunterbrook Capital, which has used stories examining companies from journalists it has hired to invest and outperform the market through the first nine months of the year.
Rudegair reports, “Hunterbrook Capital gained 23% after fees last year through September, according to an investor letter viewed by The Wall Street Journal. That was higher than indexes tracking hedge-fund performance, as well as the roughly 15% return of the S&P 500 over the same period. Many of its best-performing positions were bullish bets on stocks based on reporting from its sister newsroom, Hunterbrook Media.
“Take flying-taxi maker Joby Aviation. The hedge fund had previously bet against similar companies it thought were overhyped and potentially fraudulent. Then, a Hunterbrook Media reporter discovered an abnormally long Joby flight appear, then disappear, from public flight logs.
“He booked a room with a view of the hangar and photographed a new aircraft Joby was testing. Hunterbrook Capital bought Joby shares before the scoop was published, betting it would make Joby bears have to cover their shorts, and sold them a few weeks later after a rally. An unrelated announcement from Joby about expanding manufacturing capacity helped push the stock higher, too.”
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