Viking Global Investors' flagship hedge fund lost 1.2% in October, although its relatively cautious approach to artificial intelligence-related investments helped it outperform several competitors during a month marked by a broad technology sell-off, according to a report by Bloomberg.

The loss reduced gains for the long/short equity fund to approximately 1% for 2026, according to people familiar with the firm's performance. The results reflect the investment approach of co-founder Andreas Halvorsen, who has generally avoided making large bets on AI-related companies where valuations appear difficult to justify against expected earnings.

In a July letter to investors, Halvorsen reiterated the firm's emphasis on valuation discipline, warning that some stocks offered limited margin of safety when assessed against its revenue and earnings forecasts.

Viking manages approximately $35bn and has previously adopted a cautious stance towards technology during periods of strong market enthusiasm. The firm largely sat out the technology rallies of 2020 and 2021, avoiding some of the double-digit losses subsequently experienced by competitors when valuations fell.

Its latest positioning has again left it less exposed to the technology sector than several other hedge funds founded by former employees of Julian Robertson's Tiger Management.

Technology stocks represented just 7.5% of Viking's long equity positions at the end of June, according to regulatory filings. However, the firm retained meaningful exposure to the AI supply chain, with Taiwan Semiconductor Manufacturing Company its second-largest long position and Meta Platforms its sixth-largest.

The comparison with other Tiger Cub managers is notable. Coatue Management and Tiger Global had allocated more than 40% of their long portfolios to technology stocks at the end of June, while Lone Pine Capital's exposure exceeded 38%.

The October sell-off had a greater impact on several of those competitors. Lone Pine's hedge fund fell 9% during the month, leaving it down 7% for the year. Tiger Global lost 8.5%, while Coatue gained 0.2% in October and was up 13% through the end of the month.

Viking's more conservative positioning has not entirely insulated it from wider market volatility, but it has limited the impact of the technology correction relative to some peers. The firm has previously acknowledged that its cautious approach also meant missing opportunities during the AI-driven rally.

For Halvorsen, the challenge remains balancing the risk of overpaying for high-growth technology companies against the possibility that valuations continue to rise as AI adoption expands. October's results demonstrate the benefits of avoiding some crowded positions, while also highlighting the opportunity cost of maintaining a more restrained exposure to the sector.