New analysis from ETP provider GraniteShares shows US tech billionaires have seen their total wealth drop by GBP196 billion so far this year as the share prices of tech giants have come under pressure.
More than a fifth (21 per cent) of the 117 US billionaires in the world’s top 500 built their fortunes in technology and their total wealth has been hit since the start of 2022 as share prices of the US technology giants have fallen.
Some of the biggest falls have been among the so-called FAANG stocks – Facebook, Amazon, Apple, Netflix, and Google – with Netflix down nearly 70 per cent this year and Facebook owner Meta around 41 per cent lower. The average fall across the FAANG stocks is around 36 per cent while other tech giants such as Microsoft and Tesla have also seen share prices drop.
GraniteShares, which offers 3x short and 3x long ETPs on indexes tracking these stocks, has seen a surge in UK investors shorting the tech giants on the expectation prices will drop further.
Its 3SFG, 3SGFand 3SFT 3x short positions on FAANG, GAFAM, which includes Google, Apple, Facebook Amazon, and Microsoft, and FATANG, which covers Facebook, Amazon, Tesla, Apple, Netflix, and Google, are seeing strong growth.
Will Rhind, Founder and CEO of GraniteShares, says: “US tech billionaires have been feeling the pain this year as the share prices of their companies have come under pressure and investors believe there is more pain to come.
“If US interest rates continue to rise unchecked there could be plenty more air to be let out of the balloon when it comes to the valuations of US tech giants. Given the worries about inflation and mounting concerns about stocks being overvalued investors are naturally interested in ways to hedge against price declines”.
“Current market volatility is making the case for Short and Leveraged ETPs in a portfolio with sophisticated investors able to profit from both positive and negative market movements. For US tech it appears negative market sentiment may well last for a good while longer.”
