The world’s largest hedge fund loads up on Alibaba

Alibaba’s founder Jack Ma.
  • Bridgewater Associates, the world’s largest hedge fund that oversees $US150 billion in assets under management, bought $US15.7 million worth of Alibaba shares during the second quarter, regulatory filings show.
  • Alibaba is one of the stocks included in the “FAANG+BAT” basket.
  • Watch Alibaba trade in real time here.

Bridgewater Associates, the $US150 billion hedge fund founded by Ray Dalio, bought 84,629 shares of Alibaba in the second quarter, worth $US15.7 million, according to regulatory documents filed Tuesday. A back of the envelope calculation shows the stake was established at an average price of $US185.52.

Alibaba is one of the market’s most heavily traded tech stocks and part of the “FAANG+BAT” basket, which also includes Facebook, Amazon, Apple, Netflix, Google, and Chinese tech giants Baidu and Tencent.

Bridgewater’s buying of Alibaba shouldn’t come as a surprise. Last September, the hedge fund launched a big investment fund in China as it was granted rare access to trade in local financial markets.

In a LinkedIn post from March, Dalio wrote that an escalating tit-for-tat trade war would be a reason to “worry.” But this investment is a way for Dalio to gain exposure to China without having to worry about the impact of a trade war with China. That’s because the e-commerce giant is responsible for about 85% of e-commerce sales in China – which helps provide insulation from the trade spat.

Alibaba shares gained 4% in the second quarter despite Trump’s tariff trade spat with China. However they slumped 7% since July as investors have begun to rotate out of the “FAANG+BAT” group.

Dalio’s other new investments disclosed in the filing include a $US31.3 million stake in Cummins, a $US14.4 million stake in Walmart, and a 76% decrease in its Facebook holdings – now worth $US9.37 million.

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