Goldman Sachs reports hedge funds near five‑year high on U.S. healthcare stocks

Hedge‑fund exposure to U.S. healthcare equities reached a five‑year high last week, according to a Goldman Sachs note dated July 24, marking the second consecutive week of increased buying. The S&P 500 healthcare index is up almost 5 % year‑to‑date, while comparable European stocks have risen about 2 %.

Funds are adding positions in healthcare equipment, supplies, life‑sciences tools and pharmaceuticals, spurred by AI‑driven drug‑discovery advances, higher research productivity and an expected surge in deal volume to $173 billion by 2026. The FDA has accelerated approvals, posting its highest annual new‑drug tally since 2020, though regulatory volatility has risen. Hedge‑fund manager Felix Lo of Trium Capital notes that smaller pharma sellers are accepting larger discounts for cash certainty, creating a robust M&A environment.

Specialised healthcare hedge funds posted roughly 40 % returns between August 2025 and April 2026, versus 17 % for generalist funds. In 2024, 24 % of new hedge‑fund launches focus on healthcare—the highest share since at least 2009—representing about $283 billion of the roughly $1 trillion in equity‑hedge‑fund assets. Total hedge‑fund industry capital rose a record $409.3 billion in Q2, bringing the sector to $5.6 trillion.