Hedge Funds Face Friday Deadline For Quarterly Disclosures

Hedge funds face a Friday deadline to post third-quarter market activity, offering an insider's look into what the so-called smart money has been up to lately. It's the marquee names like Warren E. Buffett's Berkshire Hathaway Inc.

, William A. Pershing Square Capital Management LP and Carl C. Icahn's Icahn Enterprises that will garner all the attention. But roughly 3,800 investment managers participate in the quarterly ritual, and Monday alone, saw more than 100 early bird forms from more obscure funds pour into the Securities and Exchange database. Reports on Form 13F are due within 45 days after the end of each quarter, and require institutional investors with assets of more than $100 million to disclose their long positions in U.S. companies and American depositary shares. Filers range from hedge funds to mutual funds, pension managers and insurance companies. The reports are a source of potential confusion, as they don't disclose short positions, nor do they signal whether activist investors like Ackman or Icahn are merely taking passive positions or are ready to pounce. Moreover, in general, it's proven misguided in recent years to use hedge funds as an investment benchmark. A group of funds tracked by Bloomberg underperformed the S&P 500 by 23 percent last year. In fact, the most recent year in which the funds outperformed the market was 2008, when the funds lost an average of 8 percent.