The top hedge funds managed approximately USD145 billion in equity holdings in the third quarter, down from the USD150 billion under management in Q2, and down more than USD50 billion from the highs reached in 2015.
The latest Hedge Fund Tracker analysis from S&P Global Market Intelligence also shows these funds increased the total number of positions to 424 in Q3 from 399 in Q2, which was a record low for stock positions held since S&P Global Market Intelligence began tracking this data in 2014.
Stocks in the healthcare and information technology sectors were the most sold off last quarter.
“The significant sell-off in healthcare stocks this quarter may suggest that hedge funds were expecting former Secretary of State Hillary Clinton – who campaigned heavily on limiting drug prices and reinforcing healthcare reforms – to win the US presidential election,” says Pavle Sabic (pictured), head of market development, S&P Global Market Intelligence. “More broadly, the trend in healthcare is illustrative of a much more concerted move by hedge funds out of equity holdings throughout 2016; it will be instructive to see how that approach evolves in the coming months.”