HEDGEYE
Investing Ideas
User Guide
Dear Investing Ideas subscriber,
Identifying the stock market’s best long and short ideas is a full-time job. Most investors don’t have a team of 40+ research analysts vetting ideas across all corners of the stock market.
At Hedgeye, we do.
Our research team features some of the most highly-regarded analysts on Wall Street. Many of them have considerable buy-side experience. We cover Macro, Financials, Energy, Healthcare, Retail, Gaming, Lodging & Leisure (GLL), Restaurants, Industrials, Consumer Staples, Internet & Media, Housing, Materials, Technology, Demography and Washington policy analysis, including Macro, Energy, Healthcare, Telecom & Media and Defense.
Investing Ideas is a thoughtful weekly newsletter featuring our analyst team’s best longer-term investment ideas. Each idea is handpicked by our CEO Keith McCullough from our analysts’ highest-conviction fundamental calls.
Getting Started: How To Use Investing Ideas
How It Works
Each Investing Idea is selected by CEO Keith McCullough from among the more than 200 stock and ETF ideas covered by our 40+ research team. Notifications adding or removing ideas are emailed to you in real-time, the same time they go up on our website and the moment Keith’s proprietary model flashes a bullish or bearish signal. (
CLICK HERE
to read our entire “Macro Playbook.”)
After a name is added, all Investing Ideas are presented in a clear, concise, one-page stock report emailed directly to you and laying out the long-term investment thesis. Updates are sent in our weekly newsletter.
It’s that simple.
What You Get With Investing Ideas
With Investing Ideas you will receive:
Weekend Updates
Every Saturday we provide an update to each idea.
Macro Overlay
When conditions warrant, Hedgeye CEO Keith McCullough will distill and contextualize current global macro and market developments and the key takeaways you can apply to the names on our list.
Risk Ranges
Our quantitatively driven TREND Risk Ranges (3 month or more time horizon) benchmarked with Friday's closing price.
The ultimate goal is to provide a list of rigorously researched long and short stock ideas for long-term investors..
If you have any questions whatsoever, please do not hesitate to email us at
support@hedgeye.com.
We look forward to working together!
Watch the video introduction:
About Hedgeye
Hedgeye Risk Management is an independent investment research and online
financial media company. Focused exclusively on generating and delivering
thoughtful investment ideas in a proven buy-side process, the firm combines
quantitative, bottom-up and macro analysis with an emphasis on timing. The
Hedgeye team features some of the most highly-regarded research analysts on
Wall Street, all with buy-side experience, covering Macro, Financials, Energy,
Healthcare, Retail, Gaming, Lodging & Leisure (GLL), Restaurants, Industrials,
Consumer Staples, Communications, Cannabis, Housing, Materials, Technology,
Demography and Washington policy analysis.
Investing Ideas
User Guide
Investing Using Hedgeye's Trend Ranges
Investing Ideas is designed to be a thoughtful list of high-octane long and short stock ideas that stand to benefit over a longer time horizon. Any savvy stock picker will acknowledge that the best long-term stock ideas don’t follow some linear path. When you’re betting against the crowd, there are definitely going to be bumps along the way.
That’s why we’re hyper-focused on prudent risk management across short, intermediate and long-term investing durations. (The firm is called “Hedgeye Risk Management” for a reason!)
With Investing Ideas, we provide a number of solutions for you beyond just buy and hold forever. First and foremost, all stock ideas on Investing Ideas pass through our Equity Sector teams’ rigorous bottom-up fundamental research process and our Macro team’s top-down screening process.
Hedgeye CEO Keith McCullough carefully curates the list for breakouts and breakdowns using our quantitative Risk Range model. McCullough monitors our Investing Ideas names to add and remove tickers that screen well based on the market’s price, volume and volatility for each security. We also provide the “trend” Risk Ranges from McCullough’s quantitative model.
How to Use Our “Trend” Risk Ranges
Our quantitative Risk Range model was developed by Hedgeye CEO Keith McCullough during his years as a hedge fund manager. The model was specifically designed to risk manage the reflexive nature of markets.
Reflecting the uncertainty embedded in financial markets, our Risk Ranges are dynamic, meaning they are designed to change as the data changes (which is why we deliver weekly Risk Range updates for all the active names with your Investing Ideas subscription). The model uses three core inputs – price, volume and volatility – to determine the likely trading range for any publicly-traded asset class.
These Risk Ranges were also designed by Hedgeye CEO Keith McCullough to be multi-duration. Our Risk Ranges are generated across three critical durations, defined as follows:
TRADE
= 3 weeks or less
TREND
= 3 months or more
TAIL
= 3 years or less
Our Risk Ranges model is designed to be intuitive: You sell at the top end of the range and buy at the low end.
Each week we deliver Risk Ranges for all the names on Investing Ideas over the “trend duration.” These Risk Ranges are tailored to help you make longer-term decisions on a duration of 3 months or more.
Bottom Line
Since Investing Ideas features our favorite long-term stock picks, each weekly newsletter (delivered every Saturday morning) lists the “trend” Risk Ranges for all the names on the list in addition to a written fundamental research update on each of the names from our Equity Sector team.
The idea is to help you risk manage each stock idea, by combining the bullish or bearish quantitative “trend” Risk Range set-up with our analyst’s fundamental research view.
In short, our analysts identify the key catalysts looming largest for each of the names on the list and the quantitative ranges help you identify the spots to risk manage the stock.
Investing Ideas
User Guide
Macro Meets Micro
Our Investing Ideas newsletter is tailor-made for the thoughtful investor with a longer-term investment horizon seeking high-conviction opportunities – both long and short – to keep in your portfolio for many months to come.
Investing Ideas is managed by former hedge fund manager Hedgeye CEO Keith McCullough.
He handpicks the "best of the best" long and short ideas delivered to him by our team of equity research analysts. Our team of over 40 research analysts cover more than 200 stocks and ETFs spanning nearly 20 different equity sectors. In other words, we deliver to you our top stock ideas to help you protect your portfolio and grow your wealth.
“A lot of people on Wall Street, for generations really, are trying to sell you something,” McCullough says. “We don’t have a broker dealer. We don’t have an investment bank. The only thing I’m trying to sell you is success. We have one objective and that’s to be right.”
How does McCullough select our favorite Investing Ideas? Let’s walk through this rigorous five-step process.
Macro Meets Micro
In addition to being CEO, Keith McCullough also heads our Macro team. Our Macro team maintains its own top-down view of the U.S. and global economy, which McCullough uses to select from among our analysts’ best bottom-up stock ideas.
There is a five-step process through which all Investing Ideas are screened.
Here’s how it works:
1. MACRO-TOP DOWN RESEARCH:
Our Macro analysts track global economic and financial market data to detect key inflection points.
2. QUARTERLY INVESTMENT OUTLOOK:
Our Macro team identifies the three most important market-moving trends each quarter. These macro themes color the process for selecting all ideas that appear on Investing Ideas.
3. ASSET CLASSES:
Based on our fundamental Macro research our team breaks down the asset classes we like (and don’t like).
4. SECTOR STOCK IDEAS:
Our nearly 20 Equity Sector research teams identify their favorite long and short stock ideas from among the more than 200 stocks covered by Hedgeye. Each detects key catalysts for potential upside and downside.
5. QUANTITATIVE RISK RANGES:
CEO Keith McCullough takes our Equity Sector teams’ best-of-the-best 40 or 50 stock ideas and filters them through his quantitative Risk Range model. (This proprietary model is based on the market’s price, volume and volatility and suggests critical buy and sell “levels” for any publicly-traded ticker plugged into the model.)
A stock that passes this rigorous vetting process is then added to Investing Ideas by CEO Keith McCullough.
In other words, Investing Ideas stocks are generally among our Equity Sector teams’ favorite stock ideas, screen well on our quantitative Risk Range model and also fit our Macro team’s top-down research view for the global economy.
BOTTOM LINE:
You receive a carefully-curated list of Hedgeye’s best-of-the-best stock ideas. Investing Ideas is a prime example of what Hedgeye has been striving for since Day 1:
Hedge fund-quality research for everyday investors.
Investing Ideas
User Guide
Hedgeye's Macro Playbook
Our goal is to give you a foundational understanding —start to
finish—of the basics of how we analyze financial markets and
identify compelling risks and opportunities. We believe it will
amplify your use of all of our investing research products and
tools.
This Macro Playbook explains our quantitative models – like our
proprietary risk ranges and GDP predictive tracking algorithm – as
well as how we select our top investing ideas (stocks, bonds or ETFs).
Our repeatable research process has been carefully crafted and
refined throughout our decade in the independent research business.
Armed with this framework, we are confident you will make better
investing decisions.
Click here
to read our Macro Playbook
Investing Ideas
User Guide
Meet Our Research Team
We are obsessed with delivering superior investment ideas. You likely
know this by now.
Our hybrid investing approach combines:
- 1. proprietary quantitative analysis
- 2. bottom-up sector research
- 3. top-down macro research with an emphasis on duration.
The end result is an intelligent, high-octane suite of products that
draws on insights from over 40 research analysts. We cover everything
from Global Macro and Retail, to Energy, Restaurants and Washington
Policy research.
Our unique research team at Hedgeye is composed of some of the
most highly-regarded analysts in the industry. Our quantitative
models and fundamental research teams complement one another.
Here’s how.
1. QUANTITATIVE RISK RANGES
Our quantitative Risk Range model was developed by CEO Keith McCullough
during his years as a hedge fund manager.
This Risk Range model is utilized throughout the entire suite of
Hedgeye research products to augment our 40+ person research team’s
fundamental views. Think about it. All investors have some basket of
core investing ideas (stocks, bonds, ETFs or all of the above).
Identifying those investing ideas is tough enough, then you have to
deal with the uncertainty of markets.
When CEO Keith McCullough built his proprietary Risk Range model the
aim was simple: Create a quantitative risk management tool to help
investors actually
buy low and sell high.
The model uses three core inputs – price, volume and volatility – to
determine the likely daily trading range for any publicly-traded asset
class. These risk ranges are dynamic. They change as the data changes.
At its core, you sell at the top end of the range, and buy at the
low end.
Our team of 40+ fundamental research analysts pride themselves on
identifying non-consensus investing ideas. We understand that the
path from non-consensus investing idea to top-performer is far from
linear. The ultimate aim of our Risk Ranges model is to help investors
risk manage our analyst’s favorite investing ideas.
2. BOTTOM-UP SECTOR RESEARCH
Our investment research team is headquartered in Stamford, Connecticut.
It is made up of research analysts with buy-side and sell-side
experience. Our policy research team in Washington D.C. is composed
of seasoned veterans with many decades of experience. They possess
high-level experience and contacts having worked in a variety of
influential positions over the years.
Our goal is simple. Since “Day One” more than ten years ago, our
focus has been to build the most thoughtful and thorough team on Wall
Street. We seek to translate our unique, combined knowledge into
successful investment opportunities for all of our subscribers—big
and small.
Our collective investment experience includes time at Carlyle
Blue-Wave, Ardsley Partners, Buckingham Research, Morgan Stanley,
Dawson-Herman Capital, Wells Fargo Securities, to name a few, while
our combined policy experience includes time at the U.S. Court of
Appeals, U.S. Energy Department, U.S. Office of Defense, U.S. Federal
Reserve, U.S. Chamber of Commerce, and more.
3. TOP-DOWN MACRO RESEARCH
In addition to a deep bench of 19 fundamental equity and Washington
policy research teams, our Macro team measures and maps economic data
for the top 50 economies around the world, covering 90% of global GDP.
We run predictive tracking algorithms for both growth and inflation
for each of these economies to forecast the likely path for financial
markets.
Bottom Line: Our Macro team is focused on generating investable ideas
based on this research that combines their deep study of market
history, the tracking of Wall Street consensus positioning and the
volatility signals embedded in futures and options markets.
(We encourage you to dig deeper by reading our
“Macro Playbook.”
)
The combined knowledge of 1) proprietary quantitative analysis 2)
bottom-up sector research 3) top-down macro research makes your
Hedgeye subscription the best bang-for-your-investing-research-buck
out there.