Semiconductors led the selling as the Nasdaq 100 posted its worst week since April 2025 and Asia-focused stock pickers lost 6.8% in early October
Hedge funds cut their technology stock holdings at the fastest pace in at least a decade over the five trading sessions through October 15, according to Goldman Sachs prime brokerage data reported by Bloomberg .
The reduction was the largest percentage decline in Goldman’s records, which date back to 2016. The selling coincided with a 5.5% drop in the Nasdaq 100 last week, the index’s worst weekly performance since April 2025.
The data points to a broad pullback from the AI trade by professional investors, after hedge funds had built heavy exposure to chipmakers and other AI-linked stocks.
Information technology led net selling by a wide margin, and semiconductor stocks produced the largest losses in dollar terms, according to Goldman . Technology was also the worst-performing sector in the MSCI World Index over the same period.
Gross trading activity among hedge funds fell at the fastest rate in almost three months, signaling that managers were reducing overall risk rather than simply rotating between positions.
Despite the selling, technology still accounts for 23.5% of hedge funds’ net global allocations, a level in the 90th percentile of the past five years, Goldman said.
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The retreat followed a difficult week for equity hedge funds. Global fundamental long-short funds lost 2.9% in the week to October 15 and lost money every day of that week, Reuters reported , citing Goldman notes. The strategy remains up 14.3% for the year.
Asia-focused stock pickers were hit hardest, losing 6.8% in the first half of October and giving back more than half of their gains from a late-June peak, when they were up more than 40% for the year. South Korea’s Kospi fell 8% to a six-month low on October 15, while Taiwan’s market dropped more than 3%.
Goldman said global AI stocks had been net sold by long-short managers for six straight sessions, with long sales outpacing short covering. The bank also noted that fundamental long-short, systematic long-short and multi-strategy funds had never all fallen more than 80 basis points on the same day from the Covid period through the end of 2025. That has now happened three times in 2026: on February 4, July 28 and October 15.
The selloff extended to AI infrastructure credit. CoreWeave shares fell 15% on October 14 amid concerns about the company’s debt, and yields on its bonds rose above 15%.
“What we saw was less a fundamental rejection of AI and more a classic, high-velocity unwind of a crowded trade,” Bruno Schneller, managing partner at Erlen Capital Management, told Reuters.