Investors’ increased vigor has contributed to the recent spike in the value of government bonds.
Over the course of six consecutive sessions, the yield on the 10-year Treasury BX:TMUBMUSD10Y has decreased by around 30 basis points. In contrast to prices, yields move in the other way. This has happened during a time when economic reports have been weaker than anticipated, particularly in consumer and purchasing manager surveys.
According to JPMorgan analysts lead by Nikolaos Panigirtzoglou, between February 12 and February 25, commodity trading advisors, or CTAs, changed their position from short to long the asset class. According to the strategists, they can still lower yields by a further 30 basis points before reaching positions when profit-taking might start.
Additionally, so-called real money investors, such as insurers and pension funds, have joined in, increasing long positions from early February to a ten-year high.
However, according to the analysts, multi-asset investors like balanced mutual funds have not piled in as heavily.
