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Rising Rates and Energy-Driven Inflation Impact Global Hedge Funds in September, Data Insights Reports

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Long fund participation rebounds in Magnificent Seven names, notably Alphabet; short fund participation increases in Meta and Tesla

NEW YORK & LONDON--(BUSINESS WIRE)--
Rising interest rates and inflation emerged as key themes impacting global hedge funds in September, driven in part by higher energy prices. Following a 25-basis-point Federal Reserve rate hike, global bond markets experienced a selloff, while long-term Treasury yields climbed. Meanwhile, equity market gains were concentrated in a narrow group of AI-linked mega-cap technology stocks, according to Data Insights, the institutional hedge fund market intelligence platform and a division of Hazeltree.

The Data Insights Crowding Report September 2026 (formerly the Hazeltree Crowding Report) revealed a rebound in the number of funds holding long positions across several Magnificent Seven stocks compared with the previous month. Alphabet experienced a moderate month-over-month increase, while Meta, Microsoft, Nvidia and Amazon posted modest gains. Apple and Tesla, however, posted modest declines. Conversely, on the short side, Meta and Tesla saw notable increases in fund participation and Microsoft a moderate increase, while Nvidia, Amazon, Alphabet and Apple all experienced reductions.

Alphabet's long-to-short fund count ratio returned above 1.0x after falling below that level in August, leaving Apple and Tesla as the only names with more short than long holders by count. Tesla's ratio fell to 0.54x, its lowest level of the year.

Overall semiconductor sentiment turned modestly more bullish in September. Data Insights tracks activity through the PHLX Semiconductor Sector Index™, which includes 30 of the largest U.S.-traded semiconductor companies. The share of constituents exhibiting net long positioning increased to 76.7% from 73.3% the prior month. Notable positioning trends included:

Broadcom (AVGO) flipped from short-biased to long-biased in September as net long exposure crossed above 50% (from 34.1% to 54.1%), a move reinforced by a further increase in its long-to-short fund count ratio (from 1.79x to 2.53x).
On the long side, crowding remained most pronounced in Applied Materials, followed by Nvidia and Broadcom.
On the short side, Teradyne emerged as the most crowded name, followed by ON Semiconductor and Advanced Micro Devices.
The index also added four new constituents as part of its annual reconstitution — Lattice Semiconductor (LSCC), Qnity Electronics (Q), SiTime (SITM) and Tower Semiconductor (TSEM) — replacing four names that were dropped. None ranked among the most crowded names overall, although SiTime was already the fourth most crowded short name in its first month in the index.

The Data Insights Crowding Report examines hedge fund long and short crowding across the Americas, EMEA and APAC during September 2026, based on Data Insights' analysis of anonymized data covering approximately 16,000 securities on its proprietary securities-finance platform, representing more than 700 global funds. It includes the ten most crowded regional long and short positions, broken out by large-, mid- and small-cap categories.

Data Insights defines the crowding score as a relative metric that normalizes the number of funds in Hazeltree's community that are long or short a given security within a predefined group (by region and market cap) relative to its peers. When a fund goes long a stock, it generally means it either expects the stock's price to rise or is using the position to hedge its exposure to shorts. Conversely, when a fund shorts a stock, it generally means it either expects the stock's price to decline or is hedging its long exposure.

"While market gains in September were concentrated in AI-linked mega-cap technology stocks, rising interest rates and inflation concerns both contributed to market volatility," commented Tim Smith, managing director, Data Insights, Hazeltree. "The Fed's rate hike and subsequent market reaction reinforced the prospect that monetary policy could remain restrictive for longer than investors had anticipated."

Turning to the report's monthly Spotlight series, Smith added, "Broadcom stood out in September as its positioning shifted from short-biased to long-biased, with net long exposure crossing above the 50% mark (from 34.1% to 54.1%). The stock spent most of the month under pressure, yet funds moved the other way, using the pullback to rebuild long exposure."

Further Highlights at the Single-Name Level

North America: Top Movers (>10% MoM Change in Fund Counts)

Long crowding increases

Large Cap: Booking Holdings and Broadcom
Mid Cap: Insulet, WillScot, Pinterest, Evercore, Solstice, and H&R Block
Small Cap: Clear Secure, Marqeta, Donnelley Financial Solutions (DFIN), and ScanSource
Note: Darling Ingredients and Etsy in Mid Cap saw a >10% month‑over‑month decrease in long fund counts.

Short crowding increases

Mid Cap: Norwegian Cruise Line and Dick's Sporting Goods
Small Cap: LeMaitre Vascular
Note: Coinbase in Large Cap and Eos Energy in Small Cap saw a >10% month‑over‑month decrease in short fund counts.

EMEA: Top Movers (>10% MoM Change in Fund Counts)

Long crowding increases

Large Cap: Lloyds Banking Group and Glencore
Mid Cap: Balfour Beatty and Pandora
Small Cap: Glenveagh and FirstGroup

Short crowding increases

Large Cap: Kering
Mid Cap: Melrose
Small Cap: Kinnevik, Energean, and CVS Group
Note: Bayerische Motoren Werke (BMW Group), Pernod Ricard, Legal & General Group, and Universal Music Group in Large Cap; AUTO1 Group in Mid Cap; and Yellow Cake and SSP in Small Cap saw a >10% month‑over‑month decrease in short fund counts.

APAC: Top Movers (>10% MoM Change in Fund Counts)

Long crowding increases

Mid Cap: Sumitomo Chemical, Westgold Resources, and Food & Life Companies
Small Cap: Stanmore Resources, Firefly Metals, Lindian Resources, and Peet
Note: TCL Electronics in Mid Cap and Ennoconn in Small Cap saw a >10% month‑over‑month decrease in long fund counts.

Short crowding increases

Mid Cap: J&T Express
Small Cap: Ganfeng Lithium, Nanosonics, and IPH
Note: SoftBank Group in Large Cap; Alibaba Health, Hankyu Hanshin, and WiseTech Global in Mid Cap; and Deep Yellow and Minerals 260 in Small Cap saw a >10% month‑over‑month decrease in short fund counts.

To view the Data Insights Crowding Report September 2026 and past reports, click here.

Methodology

The Data Insights Crowding Report is based on anonymized and aggregated positioning data from Hazeltree’s proprietary securities‑finance platform, which reflects trading activity from its hedge fund client base of more than 700 global funds. It calculates the crowding score by sector and region (Americas, EMEA, and APAC) and analyzes both long and short crowding during September 2026.

Note to editors: To be added to the distribution list for this report, please contact btanner@hazeltree.com.

About Data Insights - A division of Hazeltree

Data Insights, a division of Hazeltree, provides proprietary market intelligence derived from anonymized positioning data across a global community of hedge funds. Through its flagship Data Insights Crowding Report and other analytical offerings, the team delivers insights into long and short positioning, market trends and investor sentiment to help financial institutions, market participants and the media better understand evolving investment dynamics. For more information, visit https://hazeltree.com/product/insights.

About Hazeltree

Hazeltree is the leading provider of treasury and liquidity management and optimization solutions purpose-built for the alternative investment industry. Trusted by more than 700 investment firms managing over $4 trillion in assets, Hazeltree empowers hedge funds, private markets firms, and asset managers to enhance operational efficiency, reduce risk, and unlock alpha. Hazeltree’s cloud-based platform facilitates nearly $8 billion in daily transactions across more than 10,000 funds. By delivering seamless connectivity across counterparties and service providers, Hazeltree enables clients to optimize cash, credit facilities, margin, and fees—driving stronger returns and greater transparency across the investment lifecycle. Hazeltree is headquartered in New York with offices in London, Bournemouth, and Hong Kong. For more information, please visit www.hazeltree.com.