Hedge Funds Go All-In on Stocks Again

Hedge funds have returned to buying stocks for a second straight week, according to Goldman Sachs prime brokerage data. This marks a reversal from their risk-cutting strategy in late July, when they ended the month down 0.8%. Long positions now outpace shorts by a ratio of 1.4-to-1, and gross trading activity has increased at its fastest pace in seven weeks.

The recent surge in materials buying is being closely watched as a potential signal for a broader risk-on rotation. If this trend persists, it could boost risk assets, including crypto and DeFi, driving up demand for tokens, DEX/CEX volumes, and adoption rates.