Hedge funds are rapidly unwinding positions and cutting staff after a brutal October, with Morgan Stanley reporting the fastest active deleveraging among stock-picking funds in over a decade, even before Thursday's market crash. - WSJ * Industry Stress: Hedge-fund market exposure has fallen roughly 9% since June, with more than 40% of stock-picking funds flat or negative for 2026 through October, according to Morgan Stanley. * Lone Pine Capital: Lost 8.8% in October and was down 7.5% year-to-date, reversing gains exceeding 40% in the first half. AI stock declines and losing short positions contributed to the reversal. * Fund Restructuring: Samlyn Capital ($7B) is cutting investment staff and narrowing its focus to financial stocks after losing roughly 5% year-to-date. Engineers Gate ($4B) is shutting most of its quantamental strategy, retaining only five portfolio managers. * Walleye Capital: The $17B+ fund cut portfolio managers and plans to return some investor capital after its worst month since March 2020. * Forced Liquidations: Arini Capital sharply reduced debt holdings partly following bank margin calls. Goldman reported technology-focused hedge funds lost over 4% Thursday, while multistrategy funds declined 1.4%. 06-NOV-2026 05:26 AM ET