Many people in the IR industry have a lot of interaction with hedge funds, and for the best dialogue, it is important to understand how they think and operate. What are the important learnings for IR.

Robert Fairbairn is Equity Market Specialist at Bloomberg and he explained how hedge funds have changed over time, their strategies and what they are driven by.

“Understanding the strategy of the hedge fund is so important. Do they care about the business? Do they care just about the fluctuations of the daily stock price or relative to something else? […] When you go into a meeting with hedge funds, is it going to be a conversation around the catalyst and is that all they’re going to care about? Or are they really interested in the growth prospects and the future of the business? Identify that. And then, are their interests aligned with yours?”

“One of the most important things for behavior with the buy side is identifying their holding period. What is the average time they hold a stock for? Is their average holding period 10 years? Well, if so, they probably want to talk about your long-term projections, your capex cycles, the future of the industry. If the average holding period is two days, two months, then probably it’s going to be really a very different conversation.”

Slido question 5: Do you communicate differently to hedge fund investors compared to other types of investors?

No, I communicate our equity story in the same way to alle investor: 50 percent

Hedge funds are not interested in investing in my business: 28 percent

Yes, I communicate our equity story in a way tailored to the focus of different investors: 22 percent

Link to on-demand streaming of session