Data from Goldman Sachs shows that hedge funds are selling technology stocks aggressively now, with net dollar selling of the sector in June the largest on record.
“Hedge funds aggressively sold TMT shares last month, led by Semis & Semi Equip (reversing the year-to-date trend) — and net U.S. TMT sales this month are expected to be the largest on record,” Goldman strategists said in a recent research report. “We scored.”
The data also shows that hedge funds’ exposure to momentum stocks fell for the first time in six months.
“REITs’ exposure to momentum is expected to decline for the first time in 6 months, and is now in the 72nd percentile over five years (vs. 91st percentile at the end of May),” the report said.
Goldman’s report comes on the heels of a recent drawdown in AI Highflyer NVIDIA (NASDAQ: NASDAQ: ). After briefly becoming the world’s most valuable company, NVIDIA saw a 3-day withdrawal of $430 billion in market cap before recovering some of those losses. NVIDIA is now behind both Microsoft (NASDAQ: NASDAQ: ) and Apple (NASDAQ: NASDAQ: ) in terms of market cap. Furthermore, stocks like Broadcom (NASDAQ: NASDAQ: ) saw heavy selling after hitting a record high post-earnings in mid-June.
“After adding risk to their portfolio for all but one week this year, trading flows from recent sessions indicate some de-risking, driven by long sales and to a lesser extent short covering,” the report added.
