Global Hedge Funds and ETFs Offload Over $40 Billion in Stocks Following Trump’s Tariff Announcement Global Hedge Funds and ETFs Offload Over $40 Billion in Stocks Following Trump’s Tariff Announcement – Ishares MSCI India ETF (BATS:INDA), Goldman Sachs Group (NYSE:GS)

In a swift response to President Donald Trump‘s global tariff hike, global hedge funds and levered exchange-traded funds (ETFs) have offloaded more than $40 billion of stocks, according to recent notes to clients from banks.

What Happened: The announcement of the severe global tariffs, the highest in over a century, has resulted in a loss of over $4 trillion in stock market value for S&P 500 companies, Reuters reported.

JPMorgan JPM has projected that volatility targeting portfolios will sell between $25 billion and $30 billion in equities in the coming days to mitigate risk. Additionally, levered ETFs are expected to sell an extra $23 billion, predominantly in tech stocks, to rebalance by the end of the day.

See Also: ‘If You’re Going To Do Dumb Things Because Your Stock Goes Down…:’ Warren Buffett’s Old Warning Gains Steam As US Stocks Wipe Out $5 Trillion After Trump Tariffs

In a separate note, Goldman Sachs GS reported that equities long/short hedge funds globally experienced the largest net selling in nearly 15 years on Thursday, becoming the most bearish since 2011. The bank also noted that portfolio managers primarily increased bets against stocks, credit, and equity ETFs following Trump’s tariff announcement, which sparked recession fears.

U.S. stocks led the hedge fund sales, with financial shares being net-sold at the fastest pace since 2016. However, sectors like real estate, staples, and utilities, known for weathering recessionary periods well, were the only ones investors bought on a net basis.

Financial experts speaking to Britain’s The Mail on Sunday see potential for investors in international ETFs, such as the iShares MSCI India ETF INDA, Vanguard’s Germany All Cap, and the Amundi UK Equity All Cap.

Why It Matters: The sudden sell-off of stocks by global hedge funds and ETFs is a direct result of the tariff hike announced by President Trump.

This move, the largest in over a century, has not only led to a significant loss in stock market value but has also increased the probability of a U.S. recession.

Read Next: Tom Lee Predicts a Market Rebound After April 9 As ‘Absurd’ Tariffs Could Spur Potential Negotiations

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