Hedge Funds Shy From Gold, Oil; Short Copper

Jul 3 2013 | 2:34am ET

Hedge funds continued to cut back on their gold investments last week, with bullish bets on the precious metal hitting a five-year low.

Hedge funds and other money managers cut their net-long gold positions by 20% in the week ended June 25, according to the Commodity Futures Trading Commission. The 31,197 futures and options contracts held by speculators was the fewest since June 2007.

Short bets against gold headed in the other direction, jumping 5% to hit their second-highest level ever.

Hedge funds don’t have much faith in other commodities, either, with net-long bets across 18 of them falling 9% last week, the biggest drop in three months. Long oil positions fell 11%, platinum bets dropped to their lowest level since August and palladium positions their most in 11 weeks. Short bets on copper also rose sharply.

Agricultural commodities were less hard-hit, with net-long positions across a basket of 11 products rising 5.9%. Those gains were not seen across the board, however, with corn and soybean holdings falling.

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