Hedge Funds Stage Epic U-Turn as Aussie Shorts Backfire
- Leveraged investors cut net shorts by more than 70%: CFTC
- More good news may leave remaining shorts exposed, NAB says
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Hedge funds beat a hasty retreat from bearish Australian dollar bets last week after wrongly wagering the risk-sensitive currency would suffer from Russia’s invasion of Ukraine.
Leveraged funds slashed net-short futures and options positions on the currency by more than 70% during the week ended March 15, according to the latest data from the Commodity Futures Trading Commission. Their net purchases were the biggest in a decade -- a Herculean reversal from a week earlier when the funds were the most bearish since 2016.