Tech unwind trims hedge fund gains, but industry remains up 8% for 2026
TOP STORY: Global hedge funds surrendered almost three percentage points of performance in July as a sharp reversal in technology stocks triggered losses across multiple strategies, although the industry remains up around 8% for the year, according to a report by users citing JPMorgan analysis.
In July, hedge funds saw a significant 3% performance drop due to a sudden decline in technology stocks, according to a JPMorgan analysis. The market downturn was exacerbated by rising oil prices from the Iran conflict and a decline in semiconductor stocks, particularly in Asia. Despite the challenging month, the hedge fund industry still maintained an 8% gain for the year, as reported by the bank.
JPMorgan noted that many funds struggled to exit heavily invested positions in technology shares before prices fell, exacerbating losses. However, some strategies performed better than others, with multi-strategy hedge funds losing an average of 2.2% and Asian-focused equity long-short managers suffering the most, with average losses of 9.4%.
Quantitative equity hedge funds also lagged, posting average losses of around 5%. The bank observed that leverage remained high, although not at its peak levels, and that a seasonal pattern of deleveraging typically occurs in July.
Written by urgent.news from Hedgeweek's reporting — not their text. Machine-written — it may contain errors, so check the original before relying on it.
