Key Takeaways
- • Hedge funds reduced technology stock positions at the fastest rate in at least a decade during the five trading sessions through Oct. 15, according to Goldman Sachs Inc.'s prime desk data.
- • Technology was the worst-performing sector over the period, as the AI trade unwound globally and the sector dropped 5.5% in its worst weekly performance since April 2025.
- • Global equities were net sold at two standard deviations against the past year's flows, with information technology leading the selling by a wide margin and the largest reduction in gross positions in two months.
- • Despite the selling, technology still accounts for 23.5% of the net allocation in Goldman's global Prime book, a level in the 90th percentile versus the past five years.
- • Net leverage fell to a one-year low of 48.6%, signaling a more cautious hedge fund posture.
Summary
Hedge funds cut their technology stock positions at the fastest pace in at least a decade over the five trading sessions ending Oct. 15, according to data from Goldman Sachs Inc.'s prime desk, as reported by Investing.com. The selling coincided with a sharp decline in global technology shares, which fell 5.5% for their worst weekly performance since April 2025 as the AI trade unwound globally. Technology was the worst-performing sector over the period covered by Goldman's data.
A note from Goldman's global banking and markets group said gross trading activity among hedge funds fell at the fastest pace in nearly three months. Global equities were net sold at two standard deviations against the past year's flows, and information technology led the selling by a wide margin, with the largest reduction in gross positions in two months. The article notes that one unnamed segment took the biggest dollar loss, though the source does not specify it in the text provided.
Despite the reduction, hedge funds still maintain substantial technology exposure. Net allocation to the sector stands at 23.5% of the global Prime book, which remains in the 90th percentile relative to the past five years, according to the Goldman note.
Hedge fund positioning has also become more defensive. Net leverage, which measures how much long positions outweigh short positions, fell to a one-year low of 48.6%, indicating reduced directional risk-taking across the group.
A note from Goldman's global banking and markets group said gross trading activity among hedge funds fell at the fastest pace in nearly three months. Global equities were net sold at two standard deviations against the past year's flows, and information technology led the selling by a wide margin, with the largest reduction in gross positions in two months. The article notes that one unnamed segment took the biggest dollar loss, though the source does not specify it in the text provided.
Despite the reduction, hedge funds still maintain substantial technology exposure. Net allocation to the sector stands at 23.5% of the global Prime book, which remains in the 90th percentile relative to the past five years, according to the Goldman note.
Hedge fund positioning has also become more defensive. Net leverage, which measures how much long positions outweigh short positions, fell to a one-year low of 48.6%, indicating reduced directional risk-taking across the group.
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