Net position as a share of open interest, weekly, 2010 to October 2026
Hover or tap a panel for that week. Below zero is net short.
October 17, 2026 · 3 min read
Are Hedge Funds Too Short? What COT Positioning Extremes Have Meant for NQ and ES
Leveraged funds are net short ES at the 13th percentile of the last three years. Fifteen years of CFTC data say extremes in hedge-fund positioning have told you little. One pattern in asset managers is worth watching.
Every Friday the CFTC publishes who holds stock index futures: dealers, asset managers, leveraged funds (mostly hedge funds and CTAs) and everyone else. The commentary follows a familiar script. When hedge funds are heavily short, a squeeze is coming. When everyone is long, the top is in. We checked the script against fifteen years of reports.
Where positioning stands now
| Market | Group | Net position, share of open interest | 3-year percentile |
|---|---|---|---|
| ES | Leveraged funds | 21.2% short | 13th |
| ES | Asset managers | 47.4% long | 69th |
| NQ | Leveraged funds | 4.1% short | 84th |
| NQ | Asset managers | 26.9% long | 50th |
Leveraged funds are more short ES than in all but 13% of the last three years of reports. On NQ the same group is less short than usual. Asset managers sit near the middle of their range on both.
What extremes were followed by
We measured each group against its own trailing three years, so slow shifts in who holds the contract do not count as signals. We took the weeks in the most-short and most-long 10% and measured the next 20 sessions from the first close after the report was public, the earliest a reader could have acted on it. The base rate is the same measurement across every week.
| Market | Group | Extreme | Weeks | Episodes | Avg next 20 sessions | Up | Shift p |
|---|---|---|---|---|---|---|---|
| ES | All weeks | Base rate | 819 | — | +1.03% | 69.5% | — |
| ES | Leveraged funds | Most short 10% | 123 | 33 | +0.27% | 56.9% | 0.13 |
| ES | Leveraged funds | Most long 10% | 109 | 33 | +1.26% | 70.6% | 0.69 |
| ES | Asset managers | Most short 10% | 95 | 18 | +2.25% | 70.5% | 0.02 |
| ES | Asset managers | Most long 10% | 143 | 34 | −0.05% | 62.2% | 0.02 |
| NQ | All weeks | Base rate | 715 | — | +1.48% | 69.4% | — |
| NQ | Leveraged funds | Most short 10% | 127 | 37 | +1.59% | 70.9% | 0.83 |
| NQ | Leveraged funds | Most long 10% | 52 | 21 | +0.92% | 55.8% | 0.53 |
| NQ | Asset managers | Most short 10% | 112 | 24 | +1.54% | 72.3% | 0.92 |
| NQ | Asset managers | Most long 10% | 129 | 31 | +1.85% | 74.4% | 0.66 |
Average change over the next 20 sessions after each positioning extreme
- Clears the shift placebo (p ≤ 0.05)
- Does not
- Base rate, every week (line)
Hover or tap a row.
The squeeze story does not show up
When leveraged funds were in their most-short decile on NQ, the next 20 sessions averaged +1.59%, against +1.48% for every week: no difference. On ES the most-short decile did worse than average, +0.27% against +1.03%, with fewer up periods. That is the opposite of a squeeze, and still not distinguishable from chance (p = 0.13). The group that is supposedly about to be squeezed has, if anything, been right slightly more often than wrong.
The one pattern worth watching
ES asset managers behave differently. When they were least long relative to their own history, ES averaged +2.25% over the next 20 sessions. When they were most long, −0.05%. Both cells clear the shift placebo at p = 0.02, the direction is contrarian on both sides, and the sign holds in both halves of the sample, 2010–2018 and 2019–2026.
Three things keep this a pattern to watch rather than a signal to trade. It is two cells out of the eight in the table, and with eight looks, a p of 0.02 somewhere is roughly a one-in-seven event by chance alone. It rests on 18 and 34 episodes. And NQ's asset managers show nothing similar: their most-long decile was followed by the best average of any row. Today ES asset managers sit at the 69th percentile, inside the middle band where the table says nothing.
Reading the next COT headline
- Compare a group with its own history, not with zero. Leveraged funds were net short ES in 97% of weekly reports over the last ten years, so "funds are short" is the normal state.
- Start the clock at Friday's release, not Tuesday's as-of date. The report describes positions three days before anyone could read it.
- Count episodes, not weeks. An extreme lasts for weeks: ES asset managers' 143 most-long weeks were 34 separate episodes.
- Ask how many groups, markets and thresholds were tried. This table has eight cells. Most published COT signals do not say how many they had.
Data and method. CFTC Traders in Financial Futures, futures only, for the E-mini S&P 500 (code 13874A) and E-mini Nasdaq-100 (code 209742), through the report of 13 October 2026. Net position is long minus short as a share of open interest. Its percentile is taken against the previous 156 weekly reports, excluding the current one. Forward changes run 20 regular sessions from the close of the first session after the report's Friday release, on NQ and ES futures closes (ES from December 2010, NQ from December 2012, through September 2026; roll-day changes are left out). Episodes are runs of consecutive qualifying weeks. The shift placebo slides the positioning series against the returns by every offset of at least 26 weeks; p is the share of offsets producing a difference at least as large.