Goldman Sachs says the AI selloff is a rotation, not a liquidation

AI stocks just had a rough stretch, and memory chipmakers took the worst of it. Goldman Sachs is telling clients not to read it as a mass exit. Rich Privorotsky, who heads EMEA delta-one at Goldman Sachs, said on October 13, 2026, that the unwind looks like a rotation rather than a liquidation. In his telling, investors are moving money around inside the AI trade, not walking away from it. How the memory selloff spread The trouble reportedly traced back to weakness at CXMT, a Chinese memory manufacturer, around October 12. What started in one corner of the chip world did not stay there for long. The KOSPI fell 5.5%. Samsung dropped 8%, SK Hynix slid 10%, and Kioxia took the heaviest hit with a 13% decline. The pain carried over to the SOXX semiconductor index, which was under pressure and potentially headed for a sixth consecutive down day. Privorotsky summed up the positioning in a few words: “Long one corner, short everything else.” Put plainly, traders were piling into a narrow set of winners and betting against much of the rest. When that kind of lopsided setup gets shaken, the exits get crowded fast. The divergence that supports the rotation story The most telling data point c...