Hedge funds purchasing stocks at a rate not seen since previous year, according to Goldman Sachs report

Cryptocurrency Market Insights for May 2025

In the dynamic world of cryptocurrency, Goldman Sachs' recent report surfaced an interesting turn of events in the global equity market. Hedge funds, as the firm's prime brokerage data reveals, have been vigorously purchasing stocks at a pace unseen since November 2024. This buying spree propelled the stock markets to record their strongest May performance in decades, with the S&P 500 climbing an impressive 6%.

But let's take a closer look at the sectors that took the bull by the horns.

Sector Snapshot

Technology: Hedge funds exhibited aggressive buying behavior in the technology sector, demonstrating a considerable appetite for tech companies with Artificial Intelligence industry ties, such as semiconductor manufacturers, technology hardware producers, and electrical equipment companies. North American tech firms received the lion's share of attention, followed closely by European tech corporations.
Other Sectors: Besides the technology sector, hedge funds also showed interest in consumer discretionary, financial, healthcare, and communications companies within the European market.

Hedge Fund Heavyweights

Goldman Sachs tracked down a multitude of "Rising Star" companies that hedge funds were routinely adding to their portfolios in Q1 2025. These stocks stretched across various sectors, including utilities, financials, and consumer discretionary, with some boasting AI exposure like Sempra and Kinder Morgan.

A Rollercoaster Ride

Earlier in May, hedge funds demonstrated a different trend, selling a substantial amount of global equities. Morgan Stanley discerned this wave of sell-offs as a contrarian indicator, hinting at potential opportunities for future gains. This contrast between the early and late May trends showcases the fluid nature of hedge fund strategies and their influence on market shifts.

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Sources:[1] Reuters[2] Morgan Stanley[3] Goldman Sachs

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Hedge funds purchasing stocks at a rate not seen since previous year, according to Goldman Sachs report