NEW YORK Aug 5 The difference between the
number of investors bearish on U.S. long-dated Treasuries
against those who were bullish shrank to its smallest in six
weeks, according to a J.P. Morgan survey.
This gap between those who were 'short' long-dated U.S.
government debt and those who were 'long' contracted after a
government report showed no wage growth in July, reducing
worries about inflation accelerating and the Federal Reserve
might raise interest rate sooner to prevent the economy from
The share of short investors exceeded the share of long
investors by 21 percentage points, down from 29 points the
previous week, according to J.P. Morgan Securities.
The share of short investors fell to 36 percent in the
latest week ending Aug. 4, from 42 percent in the prior week.
By holding fewer longer-dated Treasuries, investors reduce
the duration or interest rate risk of their portfolios in
anticipation of a market drop, which generally causes
longer-dated bonds to generate bigger losses than shorter-dated
Conversely, longer-dated Treasuries produce higher returns
than short-term debt in a market rally.
The share of long investors or those who said they held more
longer-dated Treasuries than their benchmarks rose to 15 percent
from 13 percent.
The share of neutral investors, or those who said they were
holding long-dated securities equal to their portfolio
benchmarks, rose to 49 percent from last week's 45 percent.
Benchmark 10-year Treasuries yields was 2.500
percent early Tuesday, compared with 2.462 percent a week
(Reporting by Richard Leong; Editing by Bernadette Baum)