Goldman said hedge funds sold to avoid risk in the tech stock plunge

Goldman said in a note on Wednesday that global hedge funds have reduced their net long exposure to US equities for five consecutive trading days amid a broad tech stock sell-off.

Goldman said hedge funds have sold US stocks worth the most since November 2022, approaching the highest level in five years, but did not provide specific data.

The report said hedge funds have sold US tech stocks in seven of the past eight trading days.

The tech sell-off weighed on the Nasdaq Composite Index, which fell 2.77%, the S&P 500 Index, which fell 1.39%, and the Dow Jones Industrial Average, which rose 0.59% on Wednesday.

As one of the world’s largest brokers for hedge fund trading and financing, Goldman tracks its clients’ investment portfolios to analyze trends.

Goldman said risk-off actions were concentrated in information technology stocks, followed by industrial, healthcare, discretionary and communications services.

Morgan Stanley also operates a large primary dealer, which said last week that hedge funds had reached “a multi-year low” in their investment in US software stocks.