JPMorgan Strategists Say Hedge Funds Cautious on Equity Exposure

Core Insights - Global stocks are reaching record highs, yet positioning data from JPMorgan Chase & Co. indicates that some investors, particularly hedge funds, remain cautious [1][2][4]. Group 1: Market Trends - Global stocks have surged since a low point in April, driven by strong economic data, reduced recession fears, and a dovish Federal Reserve [4]. - The demand for stocks associated with the artificial intelligence sector continues to grow, with major US companies propelling benchmarks to new highs [4]. Group 2: Investor Positioning - Macro hedge funds are showing a modestly negative equity beta, indicating a cautious stance despite a slight improvement in recent months [2]. - Speculative positioning in US equity futures is near long-run median levels, suggesting that overall exposure is average rather than excessive, even as stocks hit record levels [5]. - Short interest in the Nasdaq 100 ETF remains low, while the S&P 500 ETF has only partially reduced its short interest, indicating ongoing caution among investors [6].