Hedge funds boosted bullish bets on silver to the highest in almost four months as tensions in the Middle East sent the metal to a 30-year high.
Managed-money funds held net-long positions, or wagers on rising prices, totaling 35,159 contracts on the Comex as of Feb. 15, U.S. Commodity Futures Trading Commission data showed last week. That’s the most since October. Holdings have gained for three straight weeks, the longest streak since September.
Silver futures rallied 7.7 percent last week, the most since early December, as Egypt’s pro-democracy demonstrations spread to Bahrain, Yemen, Libya and Iran. Prices have doubled in the past year and touched $32.87 an ounce in New York on Feb. 18, the highest since March 1980.
“With the Middle East deteriorating, and the threat of inflation, you’ve got the big money flowing back into silver and precious metals,” said Matt Zeman, a metals trader at LaSalle Futures Group in Chicago. “Silver provides better upside exposure than gold. Gold hasn’t moved as much, and people are chasing yields.”
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