A sharp reversal in high-momentum U.S. equities at the start of July punished hedge-fund factor strategies. Goldman Sachs’s High-Beta Momentum Basket slumped 6.4% on Tuesday, its steepest one-day decline since January and the second-worst in more than two years. The index, which is widely used as a proxy for hedge-fund positioning, was down roughly 8% over the first two trading sessions of the month, erasing gains built during the second quarter and delivering one of the toughest stretches for long-short equity books in years. The wash-out comes against a backdrop of diverging market bets captured in the latest Commitments of Traders data. For the week ended 1 July, Commodity Futures Trading Commission figures show asset-manager long positions in S&P 500 futures edged up to a net 844,576 contracts, while speculators lifted their net short to 298,864 contracts. In rates markets, speculators expanded net short exposure in 10-year Treasury futures by more than 100,000 contracts to 783,662 and added to 30-year bond shorts, underscoring broader skepticism about the durability of the rally even as traditional equity managers stay committed.