Are hedge funds shorting the market?
Where hedge funds stand in futures on US stock indexes, crypto, currencies, Treasuries and commodities, week by week. Each position is compared with its own last 3 years, because size alone says little: what matters is whether a short is unusual and whether it is growing.
Every market
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Net position as a share of all open contracts. The shaded band is where hedge funds sat 80% of the time over the last 3 years; outside it is unusual. Dashed line: zero, as long as short.
How to read this
- Net position is long contracts minus short contracts, as a share of all open contracts in that market. Below zero is net short.
- Vs 3 years ranks this week against the last 156 weekly reports. 0 is the most short they have been, 100 the most long.
- Covering means buying back shorts. A big short that is being covered fast can fuel a squeeze. A short that keeps growing is active shorting.
- Split flags markets where hedge funds and small traders sit at opposite ends of their own history.
Who is in each group
Hedge funds are the leveraged funds group in financial futures (hedge funds and trend following funds) and managed money in commodities. Asset managers are pension funds, insurers and mutual funds. In commodities the other large group shown is producers and merchants, the companies that grow, mine or use the commodity. Small traders hold positions below the reporting threshold.
Stock index shorts are often hedges for long stock portfolios. In crypto and Treasury futures, hedge fund shorts are mostly arbitrage against spot or cash holdings, so those markets carry a note.
Questions
How can you tell if hedge funds are net short?
Every Friday the CFTC publishes the Commitments of Traders report, which splits open futures positions by type of trader as of the Tuesday before. The leveraged funds group (hedge funds and trend following funds) shows their long and short contracts. Long minus short is their net position: below zero means they are net short.
Does a big hedge fund short in S&P 500 futures mean they expect a fall?
Not always. Much of the hedge fund short in stock index futures hedges long stock portfolios or is the futures leg of a basis trade. That is why this page compares each position with its own last 3 years and watches the change: a short that keeps growing week after week says more than its size alone.
Why are hedge funds always short Bitcoin and Treasury futures?
In Bitcoin and Ether futures, much of the hedge fund short is a cash and carry trade: they hold spot coins or ETF shares and sell futures to earn the gap. In Treasury futures the same idea is called the basis trade. A shrinking short in these markets often means that trade is closing, not a bullish turn.
How often is the positioning data updated?
Weekly. Positions are as of Tuesday and the CFTC releases them on Friday at 3:30 PM Eastern, later in holiday weeks. This page updates soon after each release.
Who are small traders in the Commitments of Traders report?
Small traders are positions below the CFTC reporting threshold. They are often read as retail and smaller speculators. When hedge funds and small traders sit at opposite extremes of their own history, the market is split.
Source: CFTC Commitments of Traders report (Traders in Financial Futures and Disaggregated reports, futures only). Percentages and rankings are calculated by StreetAlpha. StreetAlpha is not affiliated with or endorsed by the CFTC. For information only, not financial advice.