Oil and gas companies like Hess, Anadarko, and Apache have been darlings of the hedge fund community in recent years, favored by such prominent players as Elliott, Citadel, and D.E. Shaw. But a reversal in the U.S. energy sector, exacerbated by a sharp and recent drop in the price of crude oil and natural gas, has hit those stocks hard, raising questions about whether those hedge funds are abandoning them.
Since June 30, the date of the last round of hedge fund filings on what stocks they hold, Hess has fallen 24 percent, Anadarko 23 percent, and Apache 29 percent—performances that weren't helped by a huge market swoon in U.S. trading Wednesday.
As the Dow fell as much as 450 points early Wednesday afternoon, multiple hedge fund traders said that the market was in liquidation mode and had been for several days, with money managers looking to dump shares whenever the market rallied modestly.