Charles Cao, Yong Chen, William Goetzmann and Bing Liang contribute to the literature on hedge funds with their study “Hedge Funds and Stock Price Formation,” which appears in the third quarter 2018 edition of the Financial Analysts Journal. The focus of their study was to determine if hedge funds, as a group, exploit and correct price inefficiencies in the stock market. Using the long-position data (long positions target what the buyer perceives to be undervalued stocks), they studied the role of hedge funds in the stock price formation process.