Here's what the best hedge funds are buying

Ole Andreas Halvorsen, Viking Global Investors
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The deadline for hedge funds to reveal their holdings at the end of the second quarter passed Friday, a quarterly tradition that sends many investors scrambling to mimic the stock picks of their idols such as Bill Ackman and Carl Icahn.

But among the marquee investors, no big trends emerged from the filings and most portfolios did not contain any groundbreaking new positions.

However, the top-performing hedge funds, many of them run by managers you've likely never heard of, made big purchases of some interesting large-cap stocks.

Many of the shares were little changed or down in the second quarter, meaning investors could get an even better price on these stocks than these top funds did. calculates the best managers of the hedge fund universe through a proprietary formula based on the SEC's public filings. It's not the actual total returns of the funds, but rather a measure of stock-picking acumen.

The return figures, which the hedge fund database calls "StockAlpha," is derived by measuring how the individual equities in the fund performed compared to if investors just bought a sector ETF instead.

Based on the latest quarterly filings, Symmetric estimates that the best stock-picking hedge fund of the last three years is Broadfin Capital, managed by Kevin Kotler, which posted a StockAlpha of 24 percent annually the last three years.

The fund's top holdings are mostly small-cap biotechnology stocks.