Facebook implosion hits hedge funds hard

Facebook just made the so-called smart money look pretty dumb.

Hedge funds holding hefty Facebook stakes got clobbered on Thursday after the social media giant’s stock plunged 19 percent after it forecast slower growth.

More than 10 percent of hedge funds surveyed by Goldman Sachs count Facebook as a top 10 holding.

The hedgies’ seeming outsize bet on Facebook — based on first-quarter regulatory filings — stands in contrast to the investments of less posh mutual funds, which have been trimming their positions in so-called FANG stocks since late 2016, Goldman said in a report Thursday.

In other words, mutual funds got dinged less from the Facebook face plant than the smart-money hedgies did.

FANG refers to Facebook, Amazon, Netflix and Google parent Alphabet.

“Most investors believe that mutual funds are overweight the popular FANG stocks, when in fact the opposite is true,” Goldman analysts wrote.

Outside of Google, mutual funds are underweight in the category, which would make their performance relative to benchmarks such as the S&P 500 appear better, analysts noted.

“Large-cap core mutual funds have usually outperformed the S&P 500 on a day when one or more of the FANG stocks has declined by [more than 5 percent],” analysts wrote.

But that’s not to say that mutual funds have always benefited from their underweight stakes in FANG stocks.

Although Facebook is down 0.9 percent this year, Netflix has soared 85 percent. Amazon and Alphabet are up 55.4 percent and 18.9 percent, respectively.