Hedge Funds Push Semiconductor Weight to Record High as Software Exposure Falls to 2019 Low
Updated
Updated · CNBC · May 25
Hedge Funds Push Semiconductor Weight to Record High as Software Exposure Falls to 2019 Low
1 articles · Updated · CNBC · May 25
Goldman Sachs said hedge funds and mutual funds are going "all in on AI," with hedge funds lifting semiconductor exposure to a record high while cutting software holdings to their lowest level since 2019.
Filings through May 18 showed hedge funds added Lam Research, Applied Materials and ASML on net, while mutual funds bought Intel and SiTime as both investor groups tilted portfolios toward chipmakers.
U.S. equity hedge funds have ridden the second-quarter rebound, returning 7% year to date through May 21 and raising net exposure to a one-year high after an initial leverage cut.
Mutual funds have been more defensive, increasing cash to 1.4% from a record-low 1.1% amid geopolitical tensions, yet only 30% are beating benchmarks versus a 37% historical average.
Goldman, which reviewed more than 1,050 hedge funds with $4.6 trillion in gross equity positions and 500-plus mutual funds with $3.9 trillion in assets, said it remains more favorable on hedge funds.
With funds all-in on AI semiconductors, are we witnessing a historic boom or the inflation of a fragile, resource-starved bubble?
As Wall Street bets trillions on AI chips, can our planet's power grids and resources actually sustain this technological revolution?
The AI gold rush is on, but who will ultimately pay the price for the massive energy and water demands it creates?