Global hedge funds suffered steep losses this week, primarily driven by a sharp unwind of crowded AI bets. Long-short funds lost 2.9% for the week, with Asia-focused managers down 2.6% and tech-focused funds off 2.0% on Thursday alone . Goldman Sachs reports six consecutive sessions of AI stock selling by long-short fund managers .
This institutional selling pressure, coupled with rising borrowing costs and investor questions about AI spending ROI, signals a deepening correction in the AI sector. CoreWeave bonds have sold off sharply, pushing yields above 15% .
Key points:
- Hedge Fund Losses: Global long-short funds down 2.9% this week .
- AI Stock Selling: Six straight sessions of net selling by long-short managers .
- Crowded Trade Unwind: Reflects a 'macro reality check' rather than fundamental rejection of AI .
This development reinforces recent market alerts regarding the AI/semiconductor sector sell-off and rotation out of tech .
Global hedge funds hammered by AI selloff this week, Asia managers lead losses
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