Hedge Funds Offload Tech Stocks at Record Pace in Broad Market Retreat
Hedge funds sold global information technology shares at the fastest three-day pace since records began in 2016, while also slashing total equity exposure by the most since November 2022.
Hedge funds reduced their positions aggressively in the final days of July, led by a record sell-off in global information technology stocks. In the three trading sessions through July 28, net sales of tech shares reached the highest level since data collection started in 2016.
The selling was not limited to one sector. Total equity exposure fell by the most over a three-day window since November 2022, with pressure seen across all sectors. The unwind was driven largely by short covering in macro instruments like index futures and ETFs, while single-stock sales registered the fifth-largest three-day outflow in the past five years.
Regionally, North America bore the brunt of the outflows, followed by Europe. The moves signal hedge funds are rapidly moving to cash or reducing market risk.
Source: The Kobeissi Letter