- Hunterbrook Capital pairs investigative journalism with trading, shifting from short-driven exposs to profiting from positive scoops and returning about 23% through Sept. 2025 versus roughly 15% for the S&P 500.
- Its newsroom-driven longs in names such as Joby Aviation and Sphere Entertainment show how proprietary reporting and alternative data can surface overlooked upside.
- The firm uses compliance controls including no insider sourcing, pre-trade review, and disclosures to separate editorial work from investment decisions.
- Research broadly supports that news sentiment moves stocks, with positive news often priced faster than negative news but effects varying by context and sometimes increasing reversal or crash risk.
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Hunterbrook Capital represents a novel model in the finance- journalism intersection: leveraging investigative reporting not primarily to uncover wrongdoers for short-selling but to identify undervalued or misunderstood companies worthy of long exposure. Founded by Nathaniel Horwitz and Sam Koppelman, the firm began by shorting based on exposures but in 2025 notably shifted to capturing the upside from positive reporting. Their 23% gain through September 2025 significantly outpaced both hedge fund indexes and the S&P 500’s ~15% in the same span.
Key trades illustrate the strategy. In the case of Joby Aviation, Hunterbrook Media uncovered evidence of unusual aircraft testing behavior—which later translated into positive corporate announcements—and Hunterbrook Capital bought ahead of the story’s publication. After the news went public, the stock rallied. Similarly, a trade in Sphere Entertainment was driven by strong ticket sales data, and a short of Dexcom followed a report on product inaccuracies.
Hunterbrook’s structural safeguards are critical. They do not use insider sources, editorial findings are vetted by a compliance officer, and they declare positions related to their reporting, aligning transparency with regulatory compliance. These practices differentiate them from activist short-sellers, reducing legal risk.
Academic literature corroborates some of these commercial results. Research by Heston and Sinha (2016) finds that “positive news stories increase stock returns quickly,” while negative news tends to provoke delayed reactions, especially around earnings disclosures. Additional studies suggest that sentiment of international news boosts returns, particularly in markets with greater media access and less financial complexity. Still, the effect sizes vary, and there is risk: one study shows that strong positive information tied to ESG/ROA performance may increase crash risk under certain conditions, possibly due to heightened expectations or speculative dynamics.
Strategic implications include:
- News- driven investing strategies may be underexploited: by systematically sourcing “good news” ex post, firms may gain in long exposure where journalism reveals underappreciated value.
- Differentiation through editorial quality and compliance may yield competitive advantages in a space dominated by short-biased activist research.
- Scalability concerns: disclosing positions tied to published stories and ensuring compliance may impose capacity constraints and dampen speed, which remains critical in news-based trades.
- Market contexts matter: in volatile environments or less efficient markets, positive news may have outsized effects, but also greater risk—especially of sharp reversals if expectations overshoot real fundamentals. Academic work points to lagged reactions and context dependency.
Supporting Notes
- Hunterbrook Capital launched in 2023 with $100 million under management.
- Through September 2025, Hunterbrook’s return was ~23%, compared to the S&P 500’s ~15%.
- Joby Aviation trade: long before publication, leveraged a scoop about testing; then sold after stock rallied post announcement.
- Short position in Dexcom following an investigation into glucose monitor accuracy; stock fell 11% after report.
- Position in Sphere Entertainment based on online ticket-sale data; gained despite being scooped by competitor on the story.
- Academic finding: positive news effects are more immediate; negative news reactions often delayed until events like earnings. Heston & Sinha.
- Study across 35 nations shows international news sentiment raises stock market returns, especially in countries with broader news access.
- Paradox in an ESG/ROA study: good performance increases crash risk—signals may amplify expectations and speculative behavior.