Hedge funds’ favourite stocks are having a brutal month

It has been a tough month for the darlings of the hedge fund investment world.

In December, Business Insider published a list of the stocks hedge funds love the most. And it has been a brutal few weeks for the top 10, with several down more than 10% in the past month. In comparison, the S&P 500 is down about 4%, and the Dow Jones industrial average is down about 5%.

It’s not all bad for hedge funds’ bets, of course, with many of the market’s favourite short trades benefitting from the recent volatility. Nvidia, a popular short target, is down 12% in the past month, for example. And Tesla’s tumbling stock has made short sellers $US1.9 billion in less than a month, as reported by my colleague Joe Ciolli.

And more generally, higher levels of dispersion – a measure that reflects how widely market returns are distributed – creates opportunities for investors. According to Bank of America Merrill Lynch, dispersion is at its highest since 2009, when the market was just starting to recover from the financial crisis.

Still, March has been rough for some of the most popular stocks. Here’s a look at the top 10 and their one-month performance:

  1. Facebook: -16.2%
  2. Amazon: -6.6%
  3. Alibaba: -3.95%
  4. Alphabet: -10.5%
  5. Microsoft: -6%
  6. Time Warner: +0.47%
  7. Apple: -7.46%
  8. Bank of America: -9.5%
  9. NXP Semiconductors: -2.93%
  10. Citigroup: -10.7%