We Backtested Every Way to Follow the Smart Money. Here's the Honest Scorecard.

Most sites that show you what hedge funds and Congress are buying are quietly selling one idea: copy them and you'll win. It's a great pitch. It's also testable — and we'd rather test it than sell it. So over the past stretch we backtested essentially every version of "follow the smart money" we could construct from the data, using the same honest method each time: measure the strategy over the 12 months forward against the S&P 500 over the same window, so a rising market can't take the credit, across bull runs and bear markets alike.

Here's everything we found, in one place.

The scorecard

Read down the right column and the pattern is unmistakable: naive "copy the smart money" strategies land on the market, plus or minus noise — and on the risk side, they can land below it exactly when it hurts.

Why the edge keeps evaporating

The same three culprits show up in test after test:

1. It's a couple of outlier years wearing a trench coat. The cloning and Congress backtests both average out to a small positive — until you remove

2016 and 2020. Strip those two vintages and the remaining decade averages roughly zero. An "edge" that lives in two years isn't an edge; it's variance.

1. The disclosure lag eats whatever's left. A 13F lands up to 45 days after quarter-end; a congressional trade up to 45 days after execution. Whatever information a trade contained has decayed by the time you — or anyone — can copy it.
2. It's crowded-growth beta, not skill. These books cluster in the same mega-cap growth names. That factor paid for a decade and then broke hardest in the 2022 repricing, where clones fell 34% against the S&P's 25%. You're not buying judgment; you're buying leverage to one crowded trade.

The two whispers that survived

We're not here to tell you nothing works — that would be as dishonest as the opposite. Two findings held a faint pulse:

• Congress and hedge funds, in aggregate, are slightly above-average buyers of large-cap US stocks — a couple of points a year on paper. Real, but too small and too inconsistent to trade after the lag.
• A tightly-filtered basket of the highest-conviction, most-widely-held names beat the S&P by 12 points a year in our backtest — and we still wrote down every reason we wouldn't sell you on it: small sample, sensitive to construction, and exactly the crowded-growth

exposure that cratered in 2022.

If there's a durable edge in here, it's a rounding error — not the market-beating machine the "smart money" label implies.

So what is this data actually for?

Not a copy-and-get-rich button. It's for the honest things, and they're genuinely valuable:

• Seeing what a manager you admire actually owns — and watching conviction build or break across quarters.
• Accountability — who in Congress is trading what, in the open.
• A research lens — a name going from one respected fund to twenty is a place to start diligence, not to end it.

We'd rather run a smart-money site that tells you the edge is mostly a myth than one that sells you the myth. The filings are a window into how serious money thinks. They are not a shortcut around thinking yourself. Browse the funds, the stocks, and the research with that frame, and the data will serve you well.

Every study linked above uses forward returns measured against the S&P 500 over the same window, so market direction is controlled for; each carries its own sample sizes and methodology notes. Nothing here is investment advice — it's the opposite: a running argument against treating any of it as a shortcut.