Hedge Funds
Hedge funds post first across-the-board 1% loss since Covid as tech rout deepens, Goldman data show
Fundamental, systematic and multistrategy managers all lost more than 1% on Thursday as Meta's share-sale plan and higher oil hit crowded tech positions.
HedgeWeekly News Desk ·
All three of the hedge fund strategy groups that Goldman Sachs' prime brokerage tracks lost more than 1% on Thursday, October 22, the first session since the Covid-19 pandemic in which fundamental, systematic and multistrategy funds fell that far together, according to Goldman data reported by Reuters and Hedgeweek.
Global fundamental long-short equity funds dropped 1.4%, their weakest day since July 16, and managers focused on technology, media and telecoms lost 2.7% on average. Systematic long-short funds fell 1.3%, their third-worst day since December 2023, while multistrategy platforms gave up 1.9%, their second-largest one-day loss since the April 2025 tariff selloff. More than two-thirds of funds finished the day lower, and concentrated short positions came under fresh pressure late in the session.
The losses tracked a sharp fall in US technology shares. The Nasdaq Composite dropped 2.6%, its biggest decline since June 5, and the Nasdaq 100 lost 2.9%, after Meta said it would create a new class of shares to raise money. Meta closed down 7%, its largest fall since July, and Nvidia slid about 4%. Goldman told clients the session was worse than the selloff a week earlier, with renewed doubts over returns on AI spending compounded by inflation worries from rising oil prices.
For allocators, the damage is now visible in October numbers. Goldman estimates fundamental long-short funds are down 3.8% this month but still up 8.8% for the year, while tech-focused funds have lost roughly 10% in October and Asia-focused fundamental managers 9.3%, though the Asia group remains 14.2% ahead year to date. The drawdown comes days after HFR data put industry capital at a record $5.64 trillion at the end of September, so the final week of October will show how much of this year's gains, and recent inflows, managers carry into year-end.