2024

Hedge

Meta

<div>
 <h3 id="key-takeaways">Key takeaways</h3>
 <ul>
 <li>Systematic hedge funds post worst weekly performance since 2024</li>
 <li>Goldman identifies $20 billion in technology stock selling</li>
 <li>Nasdaq 100 plunges 5.5% as AI financing worries spread</li>
 </ul>
 Hedge funds suffered their sharpest weekly setback in two years as the Nasdaq 100 plunged 5.5%, with Goldman Sachs identifying $20 billion in technology-stock selling over just two weeks.
 Systematic long-short hedge funds lost 2% last week, their worst weekly performance since 2024, according to a <a href="https://www.reuters.com/markets/wealth/trend-hedge-funds-saw-worst-week-since-2024-ai-stocks-fell-goldman-says-2026-10-26/" rel="noopener noreferrer nofollow">Goldman Sachs note reviewed by Reuters</a> on October 26. Fundamental long-short strategies declined another 1.1%, revealing how the latest artificial intelligence selloff has spread beyond ordinary technology investors.
 The Nasdaq 100's 5.5% weekly decline was its steepest since April 2025. The pressure followed an earlier <a href="https://www.coinpaper.com/37354/ai-chip-stocks-lose-164-trillion-in-six-sessions-as-nvidia-amd-and-micron-face-renewed-selling-pressure" rel="noopener noreferrer nofollow">semiconductor selloff</a> that erased approximately $1.64 trillion from major chipmakers over six sessions.Goldman Sachs Reports $20 Billion Tech Stock Unwind 
 Goldman's prime brokerage operation recorded approximately $20 billion in technology-stock selling during the past two weeks, approaching the $23 billion unwind recorded in July.
 The bank also reported the largest reduction in gross single-stock exposure since late July. U.S. equities were net sold for a third consecutive week and in four of the previous five weeks.
 The selling adds an institutional dimension to the <a href="https://coinpaper.com/37453/barclays-warns-ai-stock-rally-may-have-peaked-as-semiconductor-etf-slides-11-in-october-selloff" rel="noopener noreferrer nofollow">AI stock correction</a>, which has increasingly reflected concerns about borrowing costs, stretched valuations and the profitability of massive infrastructure investments.
 Trend-following funds are especially vulnerable when established market patterns reverse abruptly. As winning technology positions decline, algorithmic strategies may cut exposure, potentially reinforcing market volatility.
 Fundamental long-short managers also faced losses. Their strategies were down 3.8% for October but remained up 8.8% for 2026, while systematic strategies were down 1.1% this month and still up 18.7% year to date.
 These figures suggest a painful repositioning rather than the disappearance of hedge funds' earlier gains.Meta's 10% Drop Exposes AI Financing Concerns 
 Meta became one of the clearest examples of Wall Street's changing attitude toward AI investments.
 Its shares fell approximately 10% over the week despite strong earnings, after the company indicated it needed additional capital to support its infrastructure expansion.
 The reaction highlights a growing contradiction: companies can report substantial revenue growth while investors become increasingly concerned about the cost of financing future expansion.
 Those questions are particularly relevant for <a href="https://coinpaper.com/36295/ai-infrastructure-stocks-can-coreweave-nebius-and-iren-outgrow-financing-costs" rel="noopener noreferrer nofollow">AI infrastructure companies</a>, where enormous computing demand must be balanced against borrowing costs, equipment depreciation and construction spending.
 Earlier pressure on <a href="https://coinpaper.com/37426/coreweave-stock-plunges-22-in-one-week-as-50-billion-debt-and-16-bond-yields-alarm-investors" rel="noopener noreferrer nofollow">CoreWeave's borrowing costs</a> showed how quickly financing concerns can spread from bond markets into equity valuations.
 Meanwhile, <a href="https://coinpaper.com/37428/ai-stock-selloff-tech-funds-lose-475-billion-even-as-global-equity-funds-gain-20-billion" rel="noopener noreferrer nofollow">technology fund withdrawals</a> have indicated that some investors are shifting exposure away from the sector even as broader equity demand persists.
</div>

Goldman Sachs: Hedge Funds Suffer Worst Week Since 2024 as Nasdaq 100 Drops 5.5%

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