Hedge funds suffer their steepest single-day loss since the pandemic amid tech sell-off

On Thursday, hedge funds worldwide experienced one of their broadest single-day losses since the Covid-19 outbreak, according to a note from Goldman Sachs’ prime brokerage desk. All three major equity strategies—fundamental long/short, systematic long/short and multi-strategy platforms—declined by more than 1%, a first since the pandemic. Technology-oriented funds suffered the steepest hits, averaging a 2.7% drop, while the Nasdaq 100 fell 2.9% as investors questioned whether large AI expenditures will generate returns and feared inflation driven by higher oil prices.

Systematic long/short managers posted a 1.3% loss, their third-worst day since December 2023, and multi-strategy pods slipped 1.9%, marking their second-worst performance since the April 2025 tariff sell-off. The prime brokerage estimated that over two-thirds of hedge funds closed the day down, with concentrated short bets squeezed in the session’s second half. Despite the setback, Asian fundamental long/short managers remain up 14.2% year-to-date, though they have lost 9.3% for the month.