In the month that Nvidia briefly became the world’s largest company, hedge funds “aggressively” sold technology stocks, according to Goldman Sachs.
This month’s net selloff in the U.S. technology sector will be the biggest since 2017, with semiconductors and semiconductor equipment stocks the biggest sellers, followed by software and Internet stocks.
The data shows more, that hedge funds’ exposure to momentum stocks declined for the first time in six months.
Overall, June was a tumultuous month for the stocks of major tech companies, with Nvidia, Microsoft, Amazon.com, Meta Platforms and Apple contributing significantly to the S&P 15’s 500% gain this year.
Although hedge funds reduced their exposure, technology-related funds saw record inflows last week, leading the Nasdaq 100 to a new high on June 18. The technology sector’s share of the S&P 500 hit 33%, its highest level in about 24 years.
Defensive change is not limited to technology. Hedge funds are reducing risk across the board, with gross leverage — a measure of risk appetite — falling, especially in North America and Europe.
