Bloomberg News

Treasuries Investors Increase Longs, Cut Neutrals, JPMorgan Says

May 15, 2012

U.S. Treasuries investors raised bets to the highest level in more than two months that the price of the securities will advance, according to a weekly survey by JPMorgan Chase & Co.

The percent of “net longs” rose the most since March 5 to 11 percentage points in the week ending yesterday from zero the previous week. The number of outright longs rose by 9 percentage points to 26 percent, the most since Feb. 27. The percent of shorts decreased to 15 percent, from 17 percent. A long position is a bet that an asset will increase in value, while a short is a wager it will decrease.

“It’s a reflection of the broader market sentiment toward risk,” Srini Ramaswamy, a JPMorgan strategist in New York, said by telephone. “There are concerns around Europe, around the odds of Greece potentially exiting the European monetary Union. That’s helping to support a flight to quality into Treasuries.”

The percent of “neutrals” decreased to 59 percent from 66 percent in the same period. In the previous week, the survey was “net neutral” for the first time since April 2.

JPMorgan doesn’t disclose the number of clients in the survey.

To contact the reporter on this story: Susanne Walker in New York at swalker33@bloomberg.net

To contact the editor responsible for this story: Dave Liedtka at dliedtka@bloomberg.net


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