In the hedge fund I worked analysts created valuation models for companies using accounting and market knowledge. The portfolio manager would create positions based on that. The whole process was very complex operationally, but that was the spirit.
They* were able to beat benchmarks (think S&P 500) consistently after fees and taxes. Caveat: they operated in an emerging market, beating S&P 500, Nasdaq, etc...is likely much harder.
I also know a guy that works in a fund that trades currencies. They sort of create "valuation models" for countries using macroeconomic variables and make positions based on that.
So there you go, calculating the "fair value" of something better than other market participants can make you money. Less crowded markets will have less people doing accounting and modeling diligently, so your chances of success might be higher.
* I was just the IT guy, can't claim I was a key part in the fund's success
