Additionally, the recent BlackRock survey of professional investors indicates liquidity is one of the primary reasons these investors have warmed to the asset class.
At the sector level, favorite stomping grounds for hedge funds looking to short ETFs include energy and financial services as well as technology and consumer discretionary, according to Goldman.
Popular ETFs that are more heavily shorted by than are owned from the long side within the hedge fund community include the Consumer Discretionary Select Sector SPDR (NYSEArca: XLY), the iShares China Large-Cap ETF (NYSEArca: FXI), the U.S. Oil Fund (NYSEArca: USO) and the iShares MSCI Brazil Capped ETF (NYSEArca: EWZ).
Hedge Fund ETF Ownership
Chart Courtesy: Goldman Sachs via VaulueWalk.
ETF Trends editorial team contributed to this post.