The recent sell-off in gold may not be enough to make some hedge funds with long-term bull positions change their views that the metal is still one of the best bets for profit in a perilous global economy.

Gold has dropped around 11 percent since the start of last week as liquidity-strapped investors scrambled to convert gold into cash amid fears over Greece's near-bankruptcy, likely hitting a number of hedge funds which have profited from its bull run in recent years.

However, the yellow metal is still around 7 percent above its level at the start of July, and is up 14 percent this year, leaving long-term holders comfortably in the black for now.

I don't think... people who hold it as another currency... are changing their view, said Morten Spenner, chief executive of $2.8 billion fund of funds firm International Asset Management (IAM).

For some people who are long-term holders ... and who have banged that drum, they're likely to take it (the price fall), Spenner said, adding that short-term market volatility that put pressure on the price of gold would not sway managers to abandon their positions.

Some big-name hedge fund managers have been successfully betting on the gold price this year, including John Paulson and Paul Tudor Jones.

Meanwhile, some managed futures funds -- whose investment decisions are dictated by computer models -- such as Man Group's AHL and Winton Capital may have been hit by the fall in gold, although profits in other areas have offset the damage.

The AHL fund has sold down much of its long position in gold in recent weeks -- one of the $23.9 billion fund's best-performing trades in 2011 -- after its models showed that the metal's price was losing its momentum, although it still has a small long position.

If you look at the price action in precious metals, particularly over the last four weeks, it's been pretty sideways and choppy. That is the sort of scenario where we actually start reducing our positions because it does indicate to us that there is no strength in that trend, Kevin Chuah, senior client portfolio manager at AHL, said.

The fund, which has also taken out a small short position on base metals including copper recently, gained last week after profiting from short positions on equities and crude oil and long positions on bond markets, Chuah said.

Winton, which manages $25 billion in assets and whose flagship fund is up around 1 percent this month, declined to comment.

Coast Sullenger, managing director of Gaia Capital, which buys commodity-related stocks, said gold equities had performed well recently, despite last week's sell-off, and he may buy more gold equities if prices continue to fall.

Gold equities is one of the only sectors that has been performing, he told Reuters. If the sell-off continues, it will probably create more of a buying opportunity... Gold shares are trading at a very, very low valuation, vis-a-vis their own history.

We're of the opinion that gold shares is an asset class you should be overweight.

(Editing by Sinead Cruise and Mike Nesbit)

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