Hedge Funds Trading Euro
Hedge Funds Turning Bearish on the Euro, Again
Now, he said, it is time to bet against the euro again. He isn't alone in the view.
Many investors again are skeptical about the currency's prospects. The Federal Reserve's decision this week to buy Treasurys fanned worries about global economic growth. Wednesday brought the largest single-day decline in percentage terms for the euro against the dollar since Oct. 24, 2008.
Late afternoon in New York, the euro fell to $1.2883 from $1.3184 late Tuesday. The dollar moved to 85.40 yen from 85.36 yen. The euro sank to 110.02 yen from 112.54 yen. The pound weakened to $1.5678 from $1.5851. The dollar was at 1.0585 Swiss francs from 1.0485 francs.
Brian Yelvington, director of fixed-income strategy at Knight Libertas LLC, a Greenwich, Conn., trading firm, said a rush of funds on Monday began putting on bearish euro positions. "These are macro bets on the fundamental problems" in Europe, he said.
Other hedge funds are profiting by holding onto earlier trades. "Funds adjusted their positions but didn't abandon their core beliefs," Mr. Yelvington said. "They were happy to wait" for a new round of bad news on the euro and European debt. Source