Manager networks and hedge fund performance

Hedge fund performance is influenced by the social capital of the hedge fund manager, which is represented through network centrality measures indicating their relative position within the hierarchy of executives. By employing social capital theory and social network analysis techniques, we examine whether hedge fund manager's connectedness is associated with funds overall performance. Our findings reveal that hedge fund managers that are more connected to the network of executives have better hedge fund performance. Additionally, managers occupying more advantageous network positions exhibit superior out‐of‐sample performance compared to those with less central positions.