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HedgeCo.Net \u2014 Goldman Sachs said its Hedge Fund VIP list of the most popular long positions suffered its worst one-month underperformance versus the S&P 500 in more than 20 years of history in July. Strategists led by Ben Snider, as quoted by CNBC on August 21, also called July \u201cone of the sharpest hedge fund de-grossing episodes of the past decade.\u201d Funds trimmed AI names, including many semiconductors and most of the mega-caps. Hedgeweek, writing from the same Goldman note, put the same 20-year VIP miss and the same decade-scale de-grossing language on the tape this morning.<\/p>\n
The unwind followed a crowded second quarter. Goldman said hedge funds entered Q2 \u201call in on AI,\u201d with portfolio turnover at the highest since 2021, and that crowding in widely held longs climbed to a record. Technology accounted for 14 of the 20 Rising Stars \u2014 names with the largest increases in hedge-fund popularity last quarter. That is a positioning print, not a P&L for any named fund. It is also not a statement that every long-short book was net short the index.<\/p>\n
Gross leverage, net leverage, and AI exposure have each come down from those Q2 highs. Goldman said each still sits above its longer-term average. The bank\u2019s own wrap is that hedge-fund performance, leverage, and the most popular longs have swung with the AI trade over the last few months. CNBC and Hedgeweek both carried the residual: U.S. equity long\/short hedge funds have returned about 10% through mid-August, despite July.<\/p>\n
For hedge-fund allocators the diligence is crowding, not the monthly print. A VIP basket lagging the S&P by a 20-year extreme is a consensus-long problem. It is not a verdict on market-neutral, macro, or multi-strategy sleeves that were not sitting in those names. De-grossing that is \u201cone of the sharpest of the past decade\u201d and still leaves leverage above average is a risk-budget reset, not a cash-out. Anyone treating July as a completed AI exit is reading a Goldman positioning note as a liquidation tape.<\/p>\n
The second-order read is how tightly industry P&L is now tied to a single crowded theme. Allocators should mark the 20-year VIP miss and the decade-scale de-gross as Goldman\u2019s language, keep the ~10% year-to-date long\/short figure as a strategy estimate through mid-August, and not recast either as a named-fund return. The scarce object is a book that can live without the VIP list, not a new AI overlay.<\/p>\n","protected":false},"excerpt":{"rendered":"
HedgeCo.Net \u2014 Goldman Sachs said its Hedge Fund VIP list of the most popular long positions suffered its worst one-month underperformance versus the S&P 500 in more than 20 years o\u2026 Continue reading