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How Shadow Books Work
A shadow book puts a fund manager's disclosed holdings, or a weighted blend of several managers, beside your own portfolio: overlap, tilts, and each manager's measured track record. Here is exactly how the comparison is built and the four limits that keep it honest.
The construction, step by step
- Each manager's latest quarterly holdings report to the SEC becomes a set of weights: disclosed long US-listed stock positions, valued as filed, normalized to 100%. This is the same construction our cloneability study uses, so the shadow book and the study can never disagree about what a book is.
- A blend is the weighted sum of those maps. Pick up to eight managers and set the weights; equal weighting is the default.
- Your side of the comparison is your equity sleeve: your stocks and equity ETFs, rescaled to 100%. A disclosed book is all equity, so comparing it against your whole portfolio would be wrong by exactly your bond and cash allocation. The sleeve's share of your portfolio is always stated.
- Overlap sums the smaller weight per shared name. It is the complement of a measure professionals call active share, and we call it what it is.
The four limits, stated plainly
- The 85% floor.If we cannot price at least 85% of a manager's book value, the comparison refuses to render and says which manager fell short. A partial book silently rescaled to 100% would look confident and be wrong.
- Two dates, always. Holdings are as of each quarter end and disclosed up to 45 days later. Each component shows both dates, because they differ.
- A holdings report is not a portfolio. No shorts, cash, bonds, foreign listings, or derivatives. The shadow book is the disclosed long US equity slice, and it says so.
- The blend has no track record.Each manager's excess return was measured individually by our study, replayed at the real filing delay. The blend shows the weighted average of those separate records, labeled as arithmetic. It is not a backtest of the blend, and we never present it as one.
What a shadow book never does
It never becomes your target allocation, never simulates trades, and never tells you to buy or sell anything. The weights table is copyable if you want to act on it yourself; Moneyta will not act on it for you. Context for the whole idea: our study of whether copying fund managers works found that only 16.7% of 312 scored managers beat the index. The comparison exists so you can see the evidence for yourself. Educational information, not investment advice.
If you would rather see the screens than read the method, the step by step walkthrough builds one from scratch.