Futures Market News
Gold, silver re-attract hedge funds' interest
Feb 14, 2011 07:56 AM
Hedge funds are rapidly returning to investing in precious metal futures like gold and silver as a result of the Egyptian revolution, as the funds are seeing the largest involvement with the precious metals sector since April of last year, government data indicates.
Bloomberg reports managed-money funds shot up by 17 percent following five straight weeks of sinking value for gold, totaling 145,846 contracts as of February 2. Silver contracts also have scaled, rising 27 percent to 29,742 contracts.
"There's turmoil in Egypt, and inflation is heating up. Investment advisers and money managers are ready to put their money back to work," Adam Klopfenstein, a senior market strategist at Chicago-based Lind-Waldock, told Bloomberg.
Following 18 straight days of uprising and public demonstrations, Hosni Mubarak fled Cairo for Sharm el Sheik, effectively ending his autocratic grip on the Egyptian presidency for 30 years.
"We're more bullish on silver than gold because of its industrial component," Barry James, president of Ohio-based James Investment Research, told Bloomberg.
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