From Precy Dumlao, Opalesque Asia – Hedge funds are piling up on gold despite the drop in prices, data from the U.S. Commodity Futures Trading Commission (CFTC) showed, BusinessWeek reported.
Indeed, gold prices plunged the most in 33 years last week. Data from the CFTC showed that hedge fund managers and other speculators had raised their gold net long positions by 9.8% to 61,579 futures and options in the week ended April 16. "Money managers cut the number of bets on lower gold prices by 8.2% during the week ended Tuesday, and left their amount of bets on higher prices nearly unchanged," confirmed Dow Jones.
The move to raise wagers on gold gives speculations that hedge fund manager John Paulson is on his way to recover the money he lost on his gold bets.
Last week, it was estimated that Paulson had lost almost $1bn of his personal wealth after the price of gold crashed. Some 85% of the $9.5bn Paulson invested across his hedge funds was reportedly held in gold share classes. The precious metal plummeted 9.3% on Monday last week to take two-day losses to 13%, according to Bloomberg.
Dan Denbow, a fund manager at the $1bn USAA......................