Hedge funds continued to hold heavily crowded long positions in large-cap US technology stocks throughout 2025, according to a new report from data and technology provider Hazeltree, highlighting persistent concentration risk in the sector.
The most crowded long bets remained in Alphabet, Microsoft and Meta, reflecting strong hedge fund conviction in software and services companies seen as key beneficiaries of artificial intelligence adoption. These stocks, part of the so-called “Magnificent Seven”, continued to attract significant capital despite growing concerns around positioning risk.
On the short side, hedge funds maintained crowded positions in names such as IBM and Strategy, while Synopsys emerged as an increasingly popular short as investor concerns mounted over execution risk related to its $35bn acquisition of Ansys and weaker-than-expected revenue performance.
The report, which analysed data from more than 600 asset managers covering around 16,000 stocks globally, found that crowding patterns varied significantly by region. In the US financial sector, Wells Fargo, JPMorgan Chase and KeyCorp were among the most crowded shorts.
In Europe, hedge fund crowding was concentrated in industrial stocks on both the long and short sides, reflecting exposure to increased spending in areas including defence and energy. In Asia, crowded positions focused on industrials and technology hardware, underlining the region’s role as a manufacturing and supply-chain hub for global AI growth.
