Global Hedge Funds Hammered by AI Selloff This Week, Asia Managers Lead Losses

3-line summary

• Global fundamental long-short (stock-picker) hedge funds fell 2.9% in the week through October 15, per a Goldman Sachs prime-brokerage note cited by Reuters, trimming year-to-date gains to 14.3%; Asia-focused funds led the losses.
• On Thursday alone, global stock-pickers fell 0.9%, Asia-focused funds fell 2.6%, tech-focused funds fell 2.0%, and systematic long-short/multi-strategy funds fell roughly 1% each; Asia stock-pickers had already dropped 6.8% over the first two weeks of the month, giving back more than half of gains from a June peak when they were up over 40% year-to-date.
• Goldman said long-short funds have net-sold global AI stocks for six straight trading days amid a 'sharp AI unwind' that began Wednesday, as investors question AI-investment monetization timelines and hotter-than-expected US inflation data raised rate-hike concerns; semiconductor-heavy South Korea's KOSPI fell 8% Thursday to a six-month low, and Taiwan's market dropped over 3%.

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