{"id":57210,"date":"2023-09-05T14:47:03","date_gmt":"2023-09-05T18:47:03","guid":{"rendered":"https:\/\/ifintechworld.com\/uncategorized\/hedge-funds-drop-short-trades-on-u-s-regional-banks-goldman\/"},"modified":"2023-09-05T14:47:06","modified_gmt":"2023-09-05T18:47:06","slug":"hedge-funds-drop-short-trades-on-u-s-regional-banks-goldman","status":"publish","type":"post","link":"https:\/\/ifintechworld.com\/?p=57210","title":{"rendered":"Hedge funds drop short trades on U.S. regional banks – Goldman"},"content":{"rendered":"
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\u00a9 Reuters. FILE PHOTO: U.S. one hundred dollar notes are seen in this picture illustration taken in Seoul February 7, 2011. REUTERS\/Lee Jae-Won\/File Photo<\/span>
\n<\/i>\n<\/div>\n

By Nell Mackenzie<\/p>\n

LONDON (Reuters) – Hedge funds ditched short bets against U.S. regional banks as of the end of August and turned bullish on the broader U.S. financial sector, according to a Goldman Sachs note, just as bank stock prices began to rise.<\/p>\n

U.S. financial services companies including banks, trading firms and those working in capital markets were among the most sought-after stocks in the week ended Sept. 1, according to the note by Goldman’s prime brokerage desk, which serves hedge funds. <\/p>\n

The ratio of long trades compared with short positions on U.S. regional banks has risen by 26% since a year low in mid-July 2023, when traders were mostly short the sector, the bank said. A short or bearish bet borrows a stock in order to sell hoping its price will decline. <\/p>\n

An index of U.S. regional bank stocks has recovered roughly 20% of its value from a two-year low hit in May following the failure of Silicon Valley Bank, Signature Bank <\/span><\/span> (OTC:) and First Republic. <\/p>\n

Treasury Secretary Janet Yellen said in May that nearly all banks had access to sufficient liquidity, but warned that profit pressures might lead to consolidation in the sector.<\/p>\n

Short positions on larger U.S. banks have also declined since mid-July, with hedge fund long positions rising about 14% against short bets, the Goldman note showed.<\/p>\n

Most of the stock buying on U.S. regional banks comprised of hedge funds buying back stock that was borrowed for the purpose of short bets, or so-called short covering, Goldman said. <\/p>\n

Across broader U.S. financial services, hedge funds finished August with net long positions, the note said.<\/p>\n

The sector often includes companies such as larger banks, savings and loans, asset management companies, credit services and investment brokerage firms. <\/p>\n<\/div>\n

Read the full article here<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

\u00a9 Reuters. FILE PHOTO: U.S. one hundred dollar notes are seen in this picture illustration taken in Seoul February 7, 2011. REUTERS\/Lee Jae-Won\/File Photo By Nell Mackenzie LONDON (Reuters) – Hedge funds ditched short bets against U.S. regional banks as of the end of August and turned bullish on the broader U.S. financial sector, according […]<\/p>\n","protected":false},"author":1,"featured_media":3721,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"video","meta":{"footnotes":""},"categories":[1],"tags":[83],"class_list":["post-57210","post","type-post","status-publish","format-video","has-post-thumbnail","hentry","category-uncategorized","tag-featured","post_format-post-format-video"],"yoast_head":"\nHedge funds drop short trades on U.S. regional banks - Goldman | iFintechWorld<\/title>\n<meta name=\"description\" content=\"\u00a9 Reuters. 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