Hedge funds reduced technology positions at the fastest rate in at least a decade during the five trading sessions through Oct. 15, Goldman Sachs prime desk data shows. They still hold large tech allocations, but their net leverage fell to a one-year low.
Hedge funds cut their technology stock positions at the fastest rate in at least a decade in the five trading sessions through Oct. 15, according to data from Goldman Sachs Inc.'s prime desk.
The selling came as global technology shares declined sharply. The Nasdaq 100 dropped 5.5% for its worst performance since April 2025 last week as the AI trade unwound globally. Technology was also the worst-performing sector in the MSCI World Index during the period Goldman's data covers.
Global equities were net sold at two standard deviations against the past year's flows, the data showed. Information technology led the selling by a wide margin, with the largest reduction in gross positions in two months, and semiconductors took the biggest dollar loss. Gross trading activity among hedge funds fell at the fastest pace in nearly three months, according to a note by Goldman's global banking and markets group.
Even so, hedge funds still maintain large technology holdings. Net allocation to the sector stands at 23.5% of the global Prime book, which remains in the 90th percentile versus the past five years, the note said.
The funds have nonetheless grown more cautious. Their net leverage, which measures how much long positions outweigh short positions, fell to a one-year low of 48.6%.
Source: Investing.com
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