Hedge funds aggressively trimmed their exposure to global information
technology stocks this week, marking the sector’s sharpest selloff in
six months and the second-largest in notional terms over the past five
years, according to a note from Goldman Sachs’ Prime Services desk.
Yahoo Finance
2 days ago
Tech stocks are struggling. But there's a big difference between now and
2000, Goldman says.
The
tech sector — already under pressure from weak performance — was the
most heavily net sold group on Goldman’s prime brokerage platform.
- Net selling was driven by a mix of long reductions and fresh short positions, with a roughly 2-to-1 ratio, underscoring a decisive bearish shift.
U.S.
tech names led the rout, accounting for approximately 75% of the
notional net selling globally. The move reflects growing investor
skepticism toward the sector’s near-term prospects amid rising rates,
stretched valuations and concerns over earnings durability.
- Subsector breakdowns show the heaviest selling concentrated in Semiconductors and Semiconductor Equipment, Software and Tech Hardware.
- Only Electronic Equipment and Communications Equipment managed to avoid net outflows.
- Info Tech gross exposure on U.S. hedge fund books has now dropped to 16.4%—its lowest point in five years.
- Net exposure stands at 16.7%, ranking in the 29th percentile over the past year and just the 12th percentile over the past five, according to Goldman Sachs.
The
aggregate U.S. tech long/short ratio has fallen to 1.82, also sitting
at a 12th percentile level on a five-year basis, suggesting many funds
are no longer making strong directional bets on the sector.
The
sharp de-risking signals a meaningful shift in sentiment from hedge
funds that, until recently, had maintained relatively elevated exposure
to technology stocks.
- The move may reflect growing macro concerns or a tactical rotation into other sectors as the first quarter of 2025 winds down.
Reuters
Hedge funds exit tech, media stocks at fastest pace
in six months, Goldman Sachs says
20 hours ago
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