Hedge Funds' Net Exposure to Seven Giants Reaches 22%, a Record High

Hedge funds' net exposure to the seven giants of the U.S. stock market has risen to 22%, marking a record high, surpassing the previous peak of 21% in June 2024, and up 7 percentage points from July this year. At the bottom of the bear market in 2022, this metric was only 8%. The record long positions reflect institutional confidence in tech stocks, but it also indicates that trading may be overly crowded, and the market may not continue to rise. If the investment logic changes, large-scale liquidations could trigger a sharp reversal, impacting the S&P 500 perpetual contract market, and a decline in risk appetite could also exert pressure on Bitcoin. Hedge funds' net exposure in the semiconductor sector stands at 12%, slightly below the peak of 14% in June 2024, but significantly up from 2% at the beginning of 2025. Over the past three months, the increase in hedge funds' exposure to the seven giants has been the largest since 2023.

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