Friday, 26 December 2014
Last updated 1 day ago
Jul 11 2007 | 8:27am ET
Hedge funds are making big bets against the Standard & Poor’s 500 after a months-long market rally sputtered in June.
A Merrill Lynch report shows that “large speculators” have pushed short interest in S&P500 futures to its highest level in three years. The short bets were valued at some $45 billion for the week ending July 3, according to the Hedge Fund Monitor report authored by analysts Mary Ann Bartels and Shan Hasnat.
By contrast, short interest on the Russell 2000 fell to its lowest level in at least five years, the report said.
In spite of “crowded levels” of shorting, Bartels and Hasnat argue that hedge funds are barking up the wrong tree.
“We view this as a contrary indicator and reading continue to be bullish for stocks,” they wrote in the report.
Short-biased funds were among the top performers in June as they take advantage of a 1.66% decline in the S&P500, according to a pair of major indices. The strategy has otherwise taken a beating this year as the index has soared almost 7% in its first six months.
Dec 1 2014 | 10:21am ET
As 2014 winds down, Northern Trust Hedge Fund Services executives took some time to share their outlook on trends facing the industry in 2015. Read more…
Jeff Sprecher was simply looking for a platform to trade energies when launching ICE 14 years ago but it has grown to reach the pinnacle of both the listed futures and equities world.