March marked an extremely volatile month for both the S&P 500 (SPX) and the Nasdaq 100 (NDX) as tensions ramped between the U.S. and Iran amid rising oil and gas prices.
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Trade QQQ with leverageDuring the month, hedge funds sold off global stocks at the fastest pace in 13 years, according to Goldman Sachs’ prime brokerage unit. Eight of the 11 sectors experienced net outflows, with elevated selling pressure in industrial, materials and financial stocks.
Hedge Funds Cover Tech Shorts, Buy Consumer Staples Stocks
On top of that, elevated demand for short positions in large-cap equity ETFs led to a 17% rise in U.S. exchange-traded funds (ETF) short positions.
Interestingly enough, hedge funds were net buyers of technology, media and telecom stocks for the first time since December, although this was due to short covering instead of taking on long positions. Meanwhile, funds rotated into the consumer staples sector, buying at the fastest pace since July 2025.