Business Standard – With aluminium lagging other base metals’ spiral in the past year, hedge funds are eyeing this white metal as the next growth avenue for high profitability. Until recently, aluminium was considered a subsidiary to copper for portfolio rebalancing in base metals. Global investment fund houses have gradually started booking it on the benchmark London Metal Exchange (LME).
Generally, aluminium prices move in hand with copper, the LME market leader. The two metals compete in application industries, especially the electrical sector. But in the past year, a recovery in the US economy coupled with supply deficit forecast by the US-based International Copper Study Group (ICSG), raised supply concerns, thereby offering more potential of returns on investment for fund houses.
