Where Do Hedge Funds Have Their Big Exposures?

Navneet Kumar and Juan Sampieri

Hedge funds play a large role in global capital markets. There is limited information about their portfolio holdings, however. As of October 2022, hedge funds in aggregate held the following positions, according to the MSCI Hedge Fund Crowding model:

• In developed markets, they were long information-technology and industrials sector
• In emerging markets, they were long financials and consumer-discretionary sector
• In global markets, they were long growth and momentum factors and short yield.

Global equity markets are represented by the MSCI ACWI Investable Market Index (IMI), developed markets by the MSCI World IMI and emerging markets by the MSCI Emerging Markets IMI. North America is represented by the MSCI North America IMI, Europe by the MSCI Europe IMI, Asia-Pacific by the MSCI Pacific IMI and the U.S. by the MSCI USA IMI.