Concerns over artificial intelligence valuations and financing risks are driving a shift in investor positioning across global technology stocks. Hedge funds increased short exposure to major technology companies during October, while analysts warned that a sharp reversal in AI investment could affect global economic growth. At the same time, strong early demand for Anthropic’s proposed public offering highlights the continuing appetite for large AI businesses.
HSBC economist Frederic Neumann warned that a collapse in the AI boom could make a global recession difficult to prevent. The concern is particularly significant for Asian economies, where export growth has become increasingly dependent on demand for AI-related hardware and data-centre equipment.
Hedge Funds Reduce Big Tech Exposure
According to Hazeltree’s Data Insights Crowding Report, hedge funds increased short positions in companies including Amazon, Apple, Nvidia and Meta during October. Apple, Amazon, Meta and Microsoft recorded their lowest long-to-short ratios of 2026 as investors reassessed technology valuations and financing risks.
Apple’s long-to-short ratio declined to 0.65x, marking its third consecutive month below parity. Alphabet remained slightly above parity at 1.02x. AMD moved from a long-biased to a short-biased position, with its ratio falling from 1.18x to 0.94x. Its net long exposure declined from 77.9% to 44.4%.
Semiconductor stocks faced particularly strong selling pressure. The PHLX Semiconductor Sector Index declined approximately 16% in October, while the proportion of its constituents with net long positioning fell to 70%.
CoreWeave has emerged as another area of concern. Its 2032 bonds were reportedly yielding close to 15%, while the company’s long-to-short ratio declined from 0.60x to 0.53x. Its shares fell approximately 37% during October. Morgan Stanley’s prime brokerage desk also reported that hedge funds had turned underweight the AI trade for the first time since early 2023.
Anthropic IPO Highlights Continuing Investor Demand
Despite the concerns, Anthropic’s proposed IPO has attracted orders for several times the shares on offer during the first day of its investor roadshow, Bloomberg reported, citing people familiar with the matter.
The company has proposed a price range of $70 to $78 per share for 825 million Class A shares. At the top of the range, the public offering could raise approximately $64.35 billion. Anthropic is also considering a private placement of up to $26 billion with cornerstone investors, including Google, Nvidia, AMD, Broadcom, Micron, Microsoft and TSMC.
The combined public offering and private placement could raise as much as $90.4 billion. At the top of the proposed price range, Anthropic could reach a fully diluted valuation of approximately $1.4 trillion. The company is expected to list on Nasdaq under the ticker ANT, with pricing and trading dates reported as November 18 and November 19, respectively.
Meanwhile, Asia’s export growth remains closely tied to AI demand. Data cited by The Wall Street Journal showed strong October export growth in China and South Korea. Capital Economics estimated that AI-related goods accounted for as much as 80% of recent export growth, highlighting the exposure of regional manufacturers to any slowdown in data-centre investment.
The contrasting signals point to a market in transition. Investor demand for leading AI companies remains substantial, but hedge fund positioning, credit-market stress and concerns over the sustainability of capital expenditure indicate that investors are becoming more selective.
Why are hedge funds becoming bearish on Big Tech?
Investors are reassessing high technology valuations, AI-related financing requirements and the sustainability of large data-centre investments.
What is Anthropic targeting through its IPO?
Anthropic’s proposed public offering could raise approximately $64.35 billion at the top of its price range. A separate private placement could add up to $26 billion.
Why is CoreWeave attracting investor attention?
Its reported bond yields near 15%, declining hedge fund positioning and sharp share-price weakness have raised concerns about its financing costs and credit risk.
How could an AI slowdown affect Asia?
A slowdown in data-centre investment could reduce demand for semiconductors and other AI-related goods, affecting export-dependent economies such as China, South Korea and Taiwan.
