Hedge funds venture back to markets to buy bank shares, says Goldman Sachs

Nell Mackenzie

Tue, Apr 29, 2025, 1:20 AM 1 min read

By Nell Mackenzie

LONDON (Reuters) -Hedge funds returned into markets past week to bargain slope stocks having sold retired of positions for 8 consecutive weeks, a Goldman Sachs enactment shows.

Financial firms including U.S. banks became the second-most nett bought banal down existent property this year, said the enactment released connected Friday and seen by Reuters connected Tuesday.

That determination came arsenic markets digested what the largest U.S. banks had to accidental successful their first-quarter net reports.

Trading desks astatine JPMorgan Chase and Morgan Stanley brought successful grounds gross arsenic markets boomed aboriginal successful the year, portion Wells Fargo earned much fees from clients quarterly presentations showed.

Hedge money positions successful financials arsenic an wide banal assemblage reached a two-year high, said Goldman Sachs.

Hedge funds person taken mostly agelong positions connected these financials stocks for 5 of the past 7 weeks, said the enactment added. A agelong stake expects a banal terms to rise.

This benignant of buying outpaced the smaller fig of hedge money trades that were the effect of hedge funds buying banal to exit abbreviated bets. A trader borrows banal successful bid to abbreviated it, oregon stake that it volition diminution successful value, aft which, the trader buys it backmost again.

While superior markets firms and banks took up astir hedge money buying past week, fiscal services firms that facilitate trading were the astir bought benignant of fiscal banal this twelvemonth truthful far, said Goldman Sachs.

Global banal picking hedge money show roseate implicit 2% betwixt April 18 and 24, and systematic traders posted a 0.44% show summation during the aforesaid clip period, said the note.

(Reporting by Nell Mackenzie; editing by Dhara Ranasinghe and David Evans)