Hedge Funds Buy Tech Stocks Fastest Pace in Three Months; Semis at Record Weight
GS•Goldman Sachs analysis found hedge funds purchased technology stocks last week at the fastest pace in nearly three months, with semiconductor weight in long portfolios hitting a record high and software weight falling to its lowest level since 2019. The iShares Semiconductor ETF is up 77% year-to-date.
1. Hedge Fund Tech Buying Surge
Goldman Sachs analysis found that hedge funds increased technology stock purchases last week more rapidly than in any period since early February. Portfolio filings as of May 18 show a broad-based move into chip and software names as overall tech allocations rose sharply.
2. Record Semiconductor Weight and Software Lows
Semiconductor holdings reached the highest weight on record in hedge fund long portfolios, while software stock weight declined to its lowest point since 2019. This shift reflects growing institutional confidence in chip manufacturers amid the AI-driven demand environment.
3. Top Chip Stock Additions
Hedge funds most notably added net positions in Lam Research, Applied Materials and ASML, while mutual funds boosted stakes in Intel and SiTime. These purchases highlight investor preference for memory and equipment suppliers benefiting from AI and data center expansions.
4. Hedge Funds vs Mutual Funds Performance Divergence
U.S. equity hedge funds returned 7% year-to-date through May 21, outperforming broad market gains, while only 30% of large-cap active mutual funds exceeded their benchmarks. Hedge fund allocations now total $4.6 trillion in gross equity positions versus $3.9 trillion in mutual fund equity assets.
