Global Positioning in Stocks: Funds reduce Semi exposure

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Global Positioning in Stocks: Funds reduce Semi exposure

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Global Positioning in Stocks

Funds reduce Semi exposure

Funds globally have reduced Semiconductor exposure 20 July 2026

Active long-only funds have sold -$77.4bn of shares in the Semiconductor sector this Quant Strategy

year to rebalance position sizes after the sector rallied significantly. Funds also sold the Global

Software sector (-$58.1bn) as earnings momentum weakened. In contrast, funds bought

Energy (+$36.8bn) and Materials (+$25.8bn) this year to diversify away from the AI

theme. In June, funds globally bought Energy (+$13.2bn) and Materials (+$4.1bn) and

sold Tech Hardware (-$11.9bn) and Diversified Financials (-$8.1bn).

“Crowded Negatives” tend to underperform

Positioning analysis of long-only funds globally shows certain crowded stocks tend to

underperform while others tend to outperform. “Crowded Positives” (well-owned stocks

+ Positive Triple Momentum) have outperformed “Crowded Negatives” (well-owned

stocks + Negative Triple Momentum) by 7.8% in the last 12 months. Crowded Positives Nigel Tupper >>

Quant Strategist

currently include Samsung Electronics, TSMC, Eli Lilly, ASML, and ARM. Crowded Merrill Lynch (Australia)

Negatives include Microsoft, Walmart, ServiceNow, Intuitive Surgical, and Intuit. +61 2 9226 5735 nigel.tupper@bofa.com

Funds’ largest overweight positions AmarQuant VashiStrategist>>

By regional-sector, funds are most overweight APxJ Semis, Emerging Markets Semis, Merrill Lynch (Australia) amar.vashi@bofa.com

Europe Semis, Europe Industrials, and US Industrials. Among stocks, funds are most

Sumuhan Shanmugalingam >>

overweight TSMC, Enterprise Products, Samsung Electronics, ASML, and ARM. Quant Strategist

Merrill Lynch (Australia)