Hedge Funds Are All-In on AI Tech Stocks — Here’s What Goldman Sachs Is Seeing

TLDR

• Hedge funds bought tech stocks at the fastest pace in nearly three months last week
• Buying was led by North America and Asia emerging markets; Europe was the exception
• Semiconductors and software companies attracted the most interest
• Communications equipment and IT services stocks were sold during the same period
• Hedge fund tech positions are now at record highs relative to the MSCI world index since Goldman Sachs began tracking in 2016

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Last week, hedge funds piled into technology stocks at the fastest rate in almost three months, according to a Goldman Sachs Prime Brokerage note sent to clients on Friday.

The buying happened across most major global regions. North America and Asia emerging markets led the purchases in dollar terms. Europe was the only major region where hedge funds did not buy tech stocks.

Semiconductors and Software Lead the Charge

Funds bought in two ways. They closed out short positions — bets that prices would fall — and opened new long positions, which profit when prices rise.

Semiconductor and chip manufacturers attracted the most buying. Software companies also saw strong demand from speculators.

Not everything in tech was bought. Hedge funds sold communications equipment stocks and IT services providers during the same period.

AI-linked companies have held up well despite broader economic pressure caused by the Iran war. Firms that stand to benefit from artificial intelligence, particularly in chips and semiconductors, have avoided much of the economic drag that has hit other sectors.

Tech Positions Hit Levels Not Seen in Years

Hedge fund portfolios now hold their largest technology positions relative to the MSCI world index in over five years.

Bets on global information technology stocks have reached record highs. These are the highest levels since Goldman Sachs Prime Brokerage started tracking these trades back in 2016.

That puts current hedge fund positioning at a historic level by the firm’s own measure.

Goldman Sachs has not named specific stocks in its public-facing note. The data reflects broad trends across hedge fund portfolios rather than individual stock picks.

The buying comes as AI continues to drive interest in the tech sector. Chips and semiconductors remain central to that story, as they power the infrastructure behind AI systems.

Despite the Iran war weighing on global markets in recent months, AI-related tech stocks have largely held their ground. That resilience appears to be pulling more money from hedge funds into the sector.

The pace of buying — the fastest in nearly three months — shows that hedge funds are growing more confident in tech, not pulling back.

With positions now at record highs by Goldman Sachs’ tracking measure, the data points to a strong conviction among speculators that technology stocks, and AI-linked names in particular, still have room to run.