Here's How To Zero-In On The Alpha Hidden In 13D Activist Filings

The 13D filing marks the beginning of the activist campaign, when an activist manager goes public with plans to enrich shareholders by closing the gap between an underperforming stock and the intrinsic value of the target company. As we discussed in the previous chapter, when an individual or fund with activist intentions crosses above 5% ownership of a company, the activist must file a SC 13D with the SEC disclosing details about his or her intentions. The  SC 13D must be filed within 10 days of an activist passing the 5% threshold. There’s no doubt that investing in the target…