Pensions & Investments' Best Blogs and how they got that way

With the blogosphere expanding even faster than the hedge fund universe, the editors of Pensions & Investments decided to take a look at some of the most popular blogs in the finance, money management and pension industries to see how they stack up.

Using P&I’s own Blog Bank as a starting point, the editors rigorously reviewed more than two dozen blogs, from All About Alpha to the Wall Street Journal’s MarketBeat. Blogs were ranked on criteria such as how often they are updated, how engaging the writing is, whether actionable information is offered, whether links to other relevant sources are provided and whether the blog is entertaining. Judges also had the opportunity to offer general comments.

Since the blogs differed — sometimes significantly — in their content and format, a scale was created to level the playing field. Total scores were added up and then average scores were derived from that sum.

The editors then awarded gold, silver and bronze awards to the top three blogs (which were the top three in both total and average score categories). The Big Picture, DealBreaker and Infectious Greed took top honors.

The following provides snapshots of P&I’s top three blogs as well as 10 honorable mentions, in order of their popularity among the editors.

As a blogger, Barry Ritholtz is full of himself. And that’s one reason his Big Picture blog is Pensions & Investments’ gold award winner for Best Blog. The site was one judge’s idea of “what a blog should be.” It is dominated by Mr. Ritholtz’s range of opinions on a smattering of subjects but is squarely focused on all things linked to the financial markets. (He’s also CEO and director of equity research of Fusion IQ, an online quantitative research firm.) What sets this blog apart is the “sharp, fresh commentary,” often served chock-full of humor. Mr. Ritholtz also sprinkles some personality with non-financial morsels such as his latest musings on jazz.

With a professional background weighted toward trading and market analysis, Mr. Ritholtz is at his best when splicing and dicing movements in the stock market. But users may be hard-pressed to find, for example, an in-depth analysis on pension asset allocation trends. “It’s not as informative as I expected,” according to one P&I judge.

Mr. Ritholtz often updates The Big Picture at daily. Recent postings included a debate on speculators and the oil price spike, a study about consumer spending habits on music CDs and a report about the water supply and usage throughout the world. Within the water report, there’s a chart on how much water is consumed to make certain products; for example, it takes 20 gallons of water to make a glass of beer. Who knew?

Paul Kedrosky knows capital markets, and offers up “good, short blasts” of wisdom interspersed with plenty of humor, according to P&I’s judges. That’s one big reason it snagged the silver award in this year’s Best Blogs review. Mr. Kedrosky cut his teeth in venture capital, having been an early adopter investing in Internet companies. That’s why he’s usually at his most entertaining when poking fun at fellow venture capitalists and at his most insightful when doling out opinions on the technology sector. For example, postings on Microsoft Corp.’s abandoned attempt to acquire Yahoo Inc. were timely and relevant, replete with easy links to pertinent information such as a “nicely direct and non-nuanced letter from Carl Icahn to the malingering Yahoo board.”

Mr. Kedrosky also has a knack for posting graphs that alone can tell a story. The “job’s-eye view of the private equity bubble,” which tracks job trends in the private equity sector, is a recent example. Described by one judge as “one of the more entertaining blogs,” Mr. Kedrosky draws plenty of comments from readers that are often just as biting as his own. One, about Venezuela President Hugo Chavez’s order to mobilize tanks near the border of Colombia, read: “He is playing with fire. Outside of bowling with Bin Laden, an invasion of Colombia is the only move that can end with a cruise missile coming in his bedroom window.” Ouch.

Bronze award winner DealBreaker describes itself as an “online business tabloid and Wall Street gossip site,” but according to one reader: “For a moment, I thought I was reading ‘The Onion.’” Judges dubbed it “the industry’s version of the Daily Show,” and true to that description, readers are often left a little uneasy as to where the line is drawn between fact and fiction. One recent headline read: “Shocker: Nanny Shortage May Force Rich Parents to Care for Their Own Children.”

The blog, launched in 2006 by Elizabeth Spiers, a former New York magazine reporter who had also worked as a buyside analyst, aims to entertain. In that, it succeeds in spades. But as Ms. Spiers wrote when the blog was introduced, “Occasionally we’ll break news or do something that’s otherwise useful, which will be entirely an accident.” Ms. Spiers no longer edits the blog, but her healthy dose of irreverence bordering on rudeness remains. For example, a May 28 commentary about Alan “Ace” Greenberg, former chairman of Bear Stearns, suggested that he would often perform magic tricks much to his colleagues’ annoyance. “Traders would give him spare change ‘just to go away,’ which, little known fact, was part of his plan in the first place,” according to Bess Levin, contributing editor. The posting sums up one judge’s opinion of the blog — it is “sometimes spot-on commentary, sometimes over the top and patronizing.”

One of three blogs reviewed that’s run by a mainstream media outlet (the others being FT Alphaville from the Financial Times and DealBook from The New York Times), the Wall Street Journal’s MarketBeat was categorized by judges as a must-read rather than a fun read. Like other similar media blogs, access to a wealth of sources means that postings are timely and relevant, often serving as a stream of consciousness that supports articles in the newspaper.

In addition, the ability to tap the Journal’s staff and beyond means that a host of different voices can be heard on any given business day. Led by David Gaffen, WSJ online writer and one of the hardest-working bloggers in blogdom, the site is dominated by news analyses rather than opinions. Outspoken it is not, leading one judge to say: “The content may be great, but this is a gray, boring site.”

Footnoted.org’s laserlike focus on Securities and Exchange Commission filings is a gold mine for quirky news that most media tend to miss. This is largely because few people have the time, inclination and expertise to go through these documents with a fine-tooth comb the way Michelle Leder does. Funny enough, most of us also lack the same passion for SEC filings.

“This one provides unique and time-saving information,” according to one judge. For example, a look at 13F filings, which are required for institutional investors who control more than $100 million in equities, revealed that Yale University’s David Swensen favors iShares. “According to the filing, Swensen’s group bought a lot of this during the quarter,” according to a May 16 posting.

Ms. Leder and her small staff render the massive amount of data into what one judge found to be “easy to read, handy” compilations with easy links to ticker references. The icing on top is the often sarcastic attitude she brings to her postings. For example, a commentary one day in early May read: “It must be nice to get a raise before you even start your job. Congratulations to Stephen P. Joyce, who received one the day before his official arrival at Choice Hotels International.” Ms. Leder’s comment referred to a filing indicating that Mr. Joyce — “gotta love an executive whose name rhymes with his company” — had changed his contract just before his start date to add nearly $1 million worth of restricted stock and increased the stock option award.

Claiming one of the top spots as a news aggregator of financial information searchable by stock tickers, Seeking Alpha has amassed a sizeable following. More than 100,000 have signed up for its daily e-mail alerts, among them asset managers around the world, according to David Jackson, founder and CEO of the site. The site is also the only free provider of corporate conference call transcripts on the Internet; most others charge a fee for a similar service, Mr. Jackson said. One judge likened it to “an investment managers’ wonderland of information, news and analysis.”

But its strength may also be its weakness — it’s “awfully busy and hard to navigate” another judge said. And as an aggregator with about 1,000 contributors, all the different voices can sometimes sound like a cacophony. “Sensory overload” was one judge’s description of Seeking Alpha. Nevertheless, as a blog of blogs, its ability to filter through an increasingly unmanageable world of content and deliver it through convenient channels definitely holds promise for further growth.

Private Equity Hub does exactly what it says in the name — it sifts through current events about private equity and venture capital much like a news aggregator, but then also offers “pithy commentary” as a way to invite discussion, according to judges. The editorial comments are “relatively short takes but insightful,” one judge said, adding, “it’s a real one-stop” private equity page. A good balance between straightforward reporting on transactions and the people behind them attract both novice and longtime industry insiders.

There is also some food for thought on the business of private equity asset management. For example, a May 28 discussion examined strategies available to buyout firms in an economic downturn. (To wit: there are basically three — don’t invest, switch investment strategy or invest in downturn-resistant businesses.) But for all the “good, deep industry” material, there seems to be a lack of thoughtful visitor comments. There are just not enough of them around this hub.

The commentary is rather on the intellectual — and lengthy — side of the blogosphere, and at its heart (and head) is Nouriel Roubini, a professor of economics at New York University. So maybe that’s not surprising. As academically inclined blogs go, this one captured our judges’ attention with thoughtful analysis on economics and politics that digs deep beneath the surface of daily news. Recent topics included ‘How will financial institutions make money now that the securitization food chain is broken?’ ‘Effects of the U.S. recession on Asian growth’ and ‘The coming global economic slowdown and rising inflation: Is stagflation-lite in the cards?’

Nouriel Roubini’s Global EconoMonitor is part of RGE Monitor, which is run by a team of experts. Postings tend to be updated every few days — a drawback for some judges — but provide “well-written” analysis that is “easily navigable by region or subject,” according to one judge. Access is through registration, which may keep out the riffraff but can also act as a deterrent to new worthwhile visitors.

One of the most relevant blogs for asset managers, All About Alpha bridges the gaps between alternative investment strategies, bringing them all together through engaging, informative articles. “One of the best” was how one P&I judge put it. Partly due to the complex nature of topics that include hedge funds, 130/30 and portable alpha strategies, the postings can sometimes run too long, and the writing slow-paced. Another perplexity is that the blogger remains anonymous, making it more difficult to measure the blog’s content against the founder’s agenda.

With postings that included headlines such as ‘Replicating Hedge Funds: Traditional beta or alternative beta?’ and ‘1X0/X0 and the hunt for African alpha,’ the content is often anything but an easy read. A sense of humor helps. Consider, for example, a recent headline: “New paper claims humans required to manage hedge funds.” Good use of graphics and photos were also commended by judges.

Although this site is an extension of the Financial Times, it has the feel of an independent blog by employing a layer of sarcasm, diary-like layout and a tendency to include more general interest news than its newspaper parent. Its breezy style breaks away from the stuffiness that some other blogs associated with top newspapers have. A May 1 posting headlined ‘A devilish number …’ drew attention to the fact that the world’s is “just over a million away from having 6,666,666,666 people” in it. “Procreation is currently above trend, clearly.”

FT Alphaville also uses “live” blogs to bring readers a play-by-play account of events such as the conference call with Societe General executives on Jan. 24 following the revelation of huge losses linked to rogue trader Jerome Kerviel. One reader commented: “This is the funniest and best excerpt on the best trading (scandal) I’ve witnessed in my twenty-six (years of) trading experience.” However like other blogs run by media conglomerates, it tends to shy away from clear-cut opinions and rather focus on news and analysis. The amount of material posted can also be overwhelming. There are “more postings each day than anyone can read,” one judge said.

A large chunk of the information offered on Pension Risk Matters boils down to “great data” for pension fund sponsors, according to judges. One of the most relevant to a large chunk of P&I readers, the site hashes over issues that affect both DB and DC plans, taking into consideration asset allocation, risk management and public policy, among a bevy of related topics.

While insightful, updates are infrequent, and new postings can sometimes take more than a week. The blog is written by Susan M. Mangiero, who has more than 20 years of experience in such areas as capital markets, asset-liability management, derivatives and financial risk control. Ms. Mangiero has worked at General Electric Co., PricewaterhouseCoopers LLP and Bank of America.

The “slightly un-bloglike” site “packs a bunch in,” according to P&I judges. Edited by Andrew Ross Sorkin, a mergers and acquisitions reporter for The New York Times, Dealbook is updated often and daily, serving up a smorgasbord of news items (really just story introductions with links to the real thing) about the latest deals and the players involved in them. It’s “everything you ever wanted to know about the day in business crammed into one page,” making the site appear “a bit jumbled.”

However Mr. Sorkin’s force of personality reverberates throughout, helping to add consistency to the site. Due to the support of dedicated reporters, there’s plenty of original content. For example, a special report called “Leveraged Planet,” published April 2, looks at the ramifications of the financial ties on a global scale. Although there are links to other publications, postings often point to The New York Times. When external sources are referred, they often involve other large news conglomerates rather than opinionated, independent financial bloggers.

Perhaps more gossip than news analysis, Naked Shorts pulls no punches. That’s why the site left one judge “laughing — almost out loud,” while another said, “his writing is entertaining, his wit mordant (and) his qualifications unknown.” Greg Newton, a veteran financial journalist, takes Wall Street with not a pinch but a pound of salt. In the firing line are the people and events linked to alternative asset classes, including hedge funds, private equity and commodities. Everyone is fair game.

In a May posting about Moody’s rating agency, Mr. Newton wrote: “In one of the least surprising developments in recent financial history, Christopher ‘Flaccid’ Cox, the mutual fund fraud enabler currently masquerading as the chairman of the U.S. Securities and Exchange Commission, is already in on the fast-developing cover-up of the Moody’s misratting scandal. Cox said earlier that because the CPDOs ratings were given out by Moody’s in Europe the SEC may lack jurisdiction.”

Contact Thao Hua at [email protected]

Updated with correction