Hedge Funds Covered a Record Nasdaq Short and Pressed the Russell: September 2026
Key takeaways
- On 4 August 2026, Leveraged Funds were net short 96,145 Nasdaq-100 futures contracts, the largest short in the CFTC series since it began in June 2010. The three largest readings on record all came within three weeks: 21 July, 4 August and 11 August.
- By 15 September the short was down to 9,385, the smallest since November 2025. Almost all of the change came from shorts being closed rather than longs being added.
- In the Russell 2000 the same funds did the opposite. Their net short grew to 110,115 on 8 September, the largest since August 2025.
- In the S&P 500 they are net short 288,457, which is less short than usual: a z-score of +1.43.
- The 15 September report straddles the quarterly futures roll, which inflated open interest in all three contracts. Read that week's changes with care.
Introduction
Equity index futures are where hedge funds and CTAs adjust market exposure quickly and cheaply, so their positioning in these contracts gives a weekly view of how the fast money is leaning. This summer, that view split in two. In large-cap technology, the funds built the largest short on record and then closed it. In small caps they built their short up.
This note sets out the data for the Nasdaq-100, the Russell 2000 and the S&P 500, explains why the latest week needs a caveat, and describes what the positioning does and does not tell you. It is a description, not a forecast.
The figures come from the CFTC Traders in Financial Futures report, futures and options combined. Leveraged Funds covers hedge funds and CTAs. For the Nasdaq-100 and the S&P 500 we use the CFTC's consolidated series, which combines the different contract sizes into one figure.
Why Leveraged Funds Are Usually Short Index Futures
A net short in equity index futures is normal, and it does not mean hedge funds expect stocks to fall. Many funds hold stocks and hedge with futures. Others run relative-value trades that pair a futures short against a long elsewhere. The long side of the market is held mostly by Asset Managers, pension funds, mutual funds and insurers, who use futures to hold equity exposure.
That is why the useful question is not whether Leveraged Funds are short but whether they are more or less short than usual. The z-score and COT Index answer that question by comparing each reading with the contract's own history.
Nasdaq-100: A Record Short, Then Six Weeks of Covering
Leveraged Funds net position in Nasdaq-100 futures:
| Report date | Net position | COT Index | Z-score |
|---|---|---|---|
| 28 July 2026 | -75,414 | 11.4 | -1.68 |
| 4 August 2026 | -96,145 | 0.0 | -2.29 |
| 11 August 2026 | -92,083 | 3.6 | -2.01 |
| 18 August 2026 | -63,399 | 29.1 | -0.98 |
| 25 August 2026 | -39,846 | 50.1 | -0.14 |
| 1 September 2026 | -14,535 | 72.6 | +0.74 |
| 8 September 2026 | -32,766 | 56.4 | +0.11 |
| 15 September 2026 | -9,385 | 77.2 | +0.92 |
The August short was a record. The CFTC's consolidated Nasdaq-100 series starts in June 2010. No earlier week, out of more than 830, shows a larger Leveraged Funds short than the 96,145 contracts of 4 August. The next two largest were 92,083 on 11 August and 87,202 on 21 July. All three of the largest readings in sixteen years came within three weeks of each other.
Then it was closed. Over the six weeks to 15 September the net short shrank by 86,760 contracts, to 9,385. That is the least short Leveraged Funds have been since 25 November 2025.
Mostly covering, not new buying. The gross short fell from 138,106 contracts on 4 August to 56,782 on 15 September. The gross long rose only from 41,961 to 47,397. Nearly all of the move was funds buying back shorts they already had.
Asset Managers barely moved. They were net long 64,369 contracts on 4 August and 66,879 on 15 September.
A short this large that is covered this quickly is a flow in its own right: every contract bought back is buying. Whether the covering is finished is harder to say. At 9,385 contracts there is much less short left to cover than there was in August.
Russell 2000: The Short Went the Other Way
Leveraged Funds net position in Russell 2000 E-mini futures:
| Report date | Net position | COT Index | Z-score |
|---|---|---|---|
| 28 July 2026 | -74,919 | 32.2 | -0.60 |
| 11 August 2026 | -95,944 | 16.0 | -1.59 |
| 25 August 2026 | -97,678 | 14.7 | -1.59 |
| 1 September 2026 | -109,416 | 5.7 | -1.98 |
| 8 September 2026 | -110,115 | 5.1 | -1.93 |
| 15 September 2026 | -97,422 | 14.9 | -1.42 |
While the Nasdaq short was being closed, the Russell short was growing. On 8 September it reached 110,115 contracts, the largest since August 2025, when it peaked at 116,778. The COT Index fell to 5, the bottom of its three-year range.
The last week eased. The net short fell to 97,422, but that change needs the caveat below: the gross long jumped from 58,931 to 76,907 in a single week, during the roll.
S&P 500: Short, but Less Than Usual
Leveraged Funds were net short 288,457 S&P 500 contracts on 15 September, with a z-score of +1.43 and a COT Index of 64.1. The S&P short has been larger for most of the last year. The largest in the series was 540,832 in June 2023. The week before, on 8 September, it was 336,643.
Asset Managers were net long 899,633 contracts, the smallest since March 2026 and well below their 1,104,059 of November 2024.
The S&P reading is the least dramatic of the three, and it sits between the other two: the funds are less short than usual, but nowhere near the swing seen in the Nasdaq.
The Caveat: The Quarterly Roll
The September equity index futures expired on Friday 18 September 2026. The COT report for Tuesday 15 September was taken during the roll, when traders hold positions in both the expiring and the next contract at the same time. Open interest rose sharply in all three markets that week:
| Contract | Open interest 8 Sept | Open interest 15 Sept | Change |
|---|---|---|---|
| S&P 500 | 3,077,426 | 3,472,191 | +12.8% |
| Russell 2000 | 442,143 | 513,219 | +16.1% |
| Nasdaq-100 | 351,401 | 383,520 | +9.1% |
During a roll, both gross longs and gross shorts can move for mechanical reasons, and the net position can shift without anyone changing their view. Our guide to open interest covers why roll weeks read differently.
The Nasdaq covering does not depend on this week. Most of it happened between 4 August and 1 September, well before the roll. The Russell easing and the S&P change on 15 September do depend on it. The report for 22 September, after expiry, will show which parts were mechanical.
What the Split Can and Cannot Tell You
A record short followed by rapid covering in one index, and a growing short in another, fits a relative trade: funds leaning towards large-cap technology and away from small caps, or unwinding a bet in one while keeping it in the other. The COT report cannot confirm that reading. It shows each contract's net position separately, and it does not link a short in one to a long elsewhere.
It also cannot say what comes next. Extremes in index futures, like extremes elsewhere, can persist for weeks. The Russell short near its range floor is not, by itself, a reason to expect small caps to rise.
What to Watch in the Next Reports
- Does the Russell short return above 100,000 after the roll? If it does, the easing on 15 September was mechanical.
- Does the Nasdaq short start to rebuild? A return towards 50,000 would suggest the August short was a position that was paused, not abandoned.
- Do Asset Managers move? They are the slower money. So far they have held steady in the Nasdaq while the funds swung around them.
The next COT report, for Tuesday 22 September, is published on Friday 25 September.
Where COTInsight Fits
- Free and Pro show Leveraged Funds positioning, COT Index, z-score and regime for the S&P 500, Nasdaq-100, Russell 2000 and Dow every week. Pro adds 10 years of weekly history and CSV export, enough to put the August Nasdaq short against every earlier reading.
- Ultimate adds the full archive, PDF reports, weekly AI commentary, the REST API, VS comparison mode for putting the Nasdaq and Russell side by side, and historical outcome statistics for each contract's own readings.
- The COTInsight TradingView indicator (Ultimate) plots the COT Index, z-score and regime under the index chart, so a record short like August's is visible where you already watch price.
See pricing or open the dashboard. For an introduction to index positioning, see our COT guide for S&P 500 traders.
Frequently Asked Questions
What does the COT report show for the Nasdaq-100 in September 2026?
On the report for 15 September 2026, Leveraged Funds were net short 9,385 Nasdaq-100 contracts, down from a record 96,145 on 4 August. The COT Index was 77.2 and the z-score +0.92.
Was the August 2026 Nasdaq short really a record?
Yes, for the CFTC's consolidated Nasdaq-100 series, which starts in June 2010. The 96,145 contracts on 4 August 2026 were the largest Leveraged Funds net short in that series, and the next two largest came in the same three-week window.
Why are hedge funds short the Russell 2000?
Leveraged Funds are usually net short index futures because many hedge long stock portfolios with them. What stands out is the size: 110,115 contracts on 8 September 2026, the largest since August 2025, with a COT Index of 5.
Does the quarterly roll affect the COT report?
Yes. The report for 15 September 2026 was taken three days before the September expiry, when positions are held in two contract months at once. Open interest rose 9% to 16% in the three contracts that week.
Is this a buy or sell signal?
No. The data describes positioning. It does not forecast prices and is not investment advice.
Summary
Leveraged Funds held the largest Nasdaq-100 short in the CFTC's consolidated series, 96,145 contracts on 4 August 2026, and then closed nearly all of it: by 15 September the short was 9,385, the smallest since November 2025, and almost all of the change came from shorts being bought back. In the Russell 2000 they went the other way, building their short to 110,115 contracts on 8 September, the largest in a year. In the S&P 500 they remain short but less short than usual. The latest report was taken during the September roll, which inflated open interest by 9% to 16%, so its week-on-week changes should be confirmed by the 22 September report. Data: CFTC Commitments of Traders, Traders in Financial Futures report. Not investment advice.