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Good morning, investors. A record $1.3 trillion is expected to flow into global stocks this year.
But while everyone seems to be buying, hedge funds are betting against stocks at near-record levels.
Here's what could go wrong ↓
Buying Boom
Global stock funds are on track for a record $1.3 trillion in inflows in 2026.
But hedge funds are taking the opposite side.
According to Goldman Sachs:
Short sales outpaced purchases by roughly 5 to 1 across global stocks.
Short positions reached the 99th percentile of the past five years.
In other words, investors are pouring money into stocks while hedge funds are making unusually large bets against them.
I see three ways this could play out.
And two aren't particularly good for investors.