Hedge fund exposure to 7 biggest tech stocks at record high, Goldman Sachs says
By Nell Mackenzie and Carolina Mandl
LONDON/NEW YORK (Reuters) — Hedge funds hold record exposure to the seven biggest tech stocks by market capitalization, according to data released on Friday by Goldman Sachs, in a week Nvidia (NASDAQ:NVDA) hit an all-time high after beating revenue expectations.
The largest seven U.S. stocks collectively now make up about 20% of the total net market value held by hedge funds tracked by Goldman Sachs. They have also been instrumental in the gains in the broader U.S. equity market this year.
Microsoft (NASDAQ:MSFT), Apple (NASDAQ:AAPL), Alphabet (NASDAQ:GOOGL), Meta (NASDAQ:META), Amazon (NASDAQ:AMZN), Nvidia and Tesla (NASDAQ:TSLA) saw the biggest percent of single stock exposure as of Aug. 24, meaning the positions were trades in the individual stocks, not just in the indices like the Nasdaq.
«Hedge funds continue to embrace mega cap tech and the artificial intelligence theme,» Goldman Sachs' prime brokerage said in a note sent to a restricted group of clients and obtained by Reuters. The investment bank did not immediately comment on the note.
The companies did not immediately respond to a request for comment.
Last week, Nvidia reported record quarterly revenue fueled by strong demand for its artificial intelligence (AI)-focused chips and said the AI boom has legs.
«We essentially have had two markets: the 'Magnificent Seven' and all the rest of equities. Hedge funds will be forced into capturing these returns regardless of analysis,» said Jim Neumann, chief investment officer of Sussex Partners.
«It is momentum on steroids,» he said, adding that stock-picking hedge funds might find it harder to outperform investments in other asset classes, like fixed income.
Goldman Sachs,
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