Bullish Copper Bets Go Wrong as Warnings of `Hype' Ignored
- Money managers extend bullish bets before price rally falters
- Copper ‘riding a wave of speculative fervor’: Stifel, Nicolaus
Molten copper pours into an anode casting wheel at the Aurubis AG metals plant in Hamburg, Germany, on April 21, 2016.
Photographer: Martin Leissl/BloombergThis article is for subscribers only.
Hedge funds ignored the warnings about the red-hot copper market, and it may have cost them.
After amassing their largest holdings ever, money managers saw the value of the metal plunge last week, halting the longest rally in a decade. While global copper supplies are tightening, Barclays Plc had warned clients in August that production shortfalls were “over-hyped,” and Goldman Sachs Group Inc. said the metal was about 10 percent above fair value. Even Oscar Landerretche, the chairman of top producer Codelco, had said the gains weren’t sustainable.