NEW YORK: Hedge funds that make both bullish and bearish wagers on stocks are turning skeptical on tech megacaps just days before earnings from the likes of Apple Inc and Facebook Inc.
Their exposure to the five biggest American companies slipped over the past month, hitting the lowest level in more than two years, according to Goldman Sachs Group Inc’s prime broker. Meanwhile, options traders – who rushed in to bet on quick gains in 2020 – are retreating. Total call open interest on that small group of the United States giants sank to a 14-month low, data compiled by Bloomberg show. The cohort of Faangs, which also includes Amazon.com Inc, Microsoft Corp and Google’s parent Alphabet Inc, is expected to report US$67bil (RM278bil) in combined profits during the third quarter, according to Bloomberg Intelligence. That’s a 30% increase from a year ago – roughly in line with the S&P 500.
