Hedge funds sold off technology stocks at the fastest rate in six months last week, Goldman Sachs analysts report, with the selling activity reaching a five-year high driven by concerns over impending tariffs set by President Donald Trump.
Goldman Sachs reported that 75% of the hedge fund selling was concentrated in the tech sector, particularly affecting AI-related hardware manufacturers. So-called Magnificant 7 tech stocks were “by far the most net sold on the Prime book this week,” according to a note sent to Goldman clients on Friday.
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The sell-off coincided with a notable shift towards short selling, with Nvidia, Advanced Micro Devices, and Tesla emerging as the most shorted stocks.
(Source: Reuters)
Analysts linked the downward trend to fears of a potential recession and the impact of upcoming copper tariffs. “With the tariff news, it was interesting that hedge fund flows and positioning might suggest they’re already somewhat prepared—at least in terms of key areas that have been in focus,” said a client note from JPMorgan.
Hedge fund exposure to tech stocks has now declined to a five-year low, reflecting a reversal from prior purchases in mid-March.
Additionally, strong retail buying may have contributed to the changes in hedge fund positioning.
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