Instant History Bias

An inaccuracy in the appearance of investment fund returns that occurs when only new, successful funds report their numbers while new, unsuccessful funds close and their poor returns aren't factored into an investment manager's or investment type's overall performance record.

Instant history bias, which especially occurs in hedge funds, is also called "backfill bias" because hedge fund managers may choose not report fund performance to a database from the fund's inception, but instead choose to "backfill" the database later when they have established a track record of success with a fund.

Other types of bias that exist in hedge fund reporting include survivorship bias (the inaccurate appearance of high returns because poorly performing funds are closed and their returns are not counted) and non-reporting bias (the inaccurate reporting of overall returns because some funds, probably poorly performing ones, decline to report their returns).

These types of bias may make hedge funds appear to be a better-performing asset type than they really are, because hedge fund managers can choose whether to report the performance of their funds.