Hedge funds were net sellers of financial stocks in the first quarter after gobbling up sector assets in the preceding two quarters.

According to a Goldman Sachs analysis of 755 hedge funds, with $833 billion of long equity positions, hedge funds now appear net short financials compared with 14% net long at year-end and 26% at the end of the third quarter. Long holdings in financials fell by $20 billion in the first quarter, and hedge fund short positions rose by an estimated $7 billion, suggesting funds were 9% net short the sector. Financials rallied 7% in April but the number of shares shorted was flat.

In addition, equity long/short funds represent the largest category of the hedge fund universe, with 34% of long equity assets, or $283 billion of the $833 of total long equity assets, and performed worst last quarter, losing 4.1% because of their overweight in the information technology space. Energy positions helped global macro funds to post highest returns.

On the flip side, global macro funds, which account for 2% of hedge fund long equity assets, were mostly tilted toward energy and financial names and posted the strongest returns of any hedge fund strategy gaining 6.9% during the quarter.