Global hedge funds have reportedly reduced their holdings in technology stocks at the fastest rate in the past decade over a five-day period ending on October 15.
According to a prime brokerage report from Goldman Sachs released on October 19, hedge funds sold off technology stocks rapidly during this timeframe. This decline marks the largest drop since Goldman Sachs began tracking the data in 2016. Despite the reduction, hedge funds still maintain a significant portion of technology stocks in their portfolios.
The report indicates that technology stocks account for 23.5% of hedge fund portfolios, placing them in the top 10% compared to the past five years.
Goldman Sachs analyzed that the recent sell-off primarily involved the liquidation of existing positions, a strategy known as 'long position liquidation.' This approach entails selling stocks that were previously purchased with the expectation of price increases, aiming to prevent further losses during a downturn.
Last week, the NASDAQ 100 index, heavily weighted in technology stocks, fell by 5.5% as enthusiasm for artificial intelligence (AI) investments waned. This represents the largest weekly decline since April 2025.
During the five-day period tracked by Goldman Sachs, technology stocks performed the worst within the MSCI World Index. The sell-off was concentrated in the information technology sector, with the semiconductor industry experiencing the most significant financial impact.
* This article has been translated by AI.
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