Understanding Position Sizing for Fundamental Investors

Fundamental investors often focus intensely on research, but their discipline in position sizing can sometimes be lacking. While their best idea is usually their largest position, determining the sizing of other ideas can be challenging. Alpha Theory, a tool used by many successful fundamental managers, helps investors systematically size their positions based on research efforts. By connecting extensive research with portfolio stock selection, this tool has enhanced position sizing processes for over 300 managers, potentially benefiting anyone looking to improve their approach.