The 13F filing shows that Oaktree Capital exited KE Holdings, Alibaba, and Huazhu convertible bonds in Q3 but increased its positions in BOSS Zhipin, Li Auto, and JD.com convertible bonds. David Tepper significantly raised his stake in Baidu to $137.7 million, exited KE Holdings, slightly reduced his position in Alibaba but still holds a substantial stake worth $1.15 billion. Bridgewater Associates continued its Q2 strategy by maintaining zero exposure to Chinese stocks.
Despite the bullish trend in Chinese stocks this year, major U.S. hedge funds adopted differentiated allocation strategies in the third quarter. According to the latest 13F filings, several well-known fund management institutions rebalanced their investments in Chinese stocks.
Oaktree Capital made a comprehensive adjustment to its exposure in Chinese corporate equities and convertible bonds during the third quarter, completely liquidating holdings such as $KE Holdings (BEKE.US)$ . Billionaire investor David Tepper's Appaloosa fund adopted a more refined portfolio adjustment strategy, increasing its position in $Baidu (BIDU.US)$ while moderately reducing core holdings such as $Alibaba (BABA.US)$ . Bridgewater Associates, the world’s largest hedge fund, has fully divested from U.S.-listed Chinese stocks since the second quarter and maintained zero exposure throughout the third quarter.
Oaktree Capital significantly restructured its Chinese investment portfolio
Oaktree Capital, founded by Howard Marks, made significant adjustments to its Chinese stock portfolio in the third quarter. According to the latest 13F filing from the U.S. Securities and Exchange Commission, the fund liquidated its entire holding of 1.5 million shares in KE Holdings, valued at $26.8 million.
In terms of convertible bond investments, Oaktree Capital exited its $6.9 million position in Alibaba Group’s convertible bonds and its $7.3 million bond investment in Huazhu Group.
However, Oaktree Capital selectively increased exposure to certain Chinese stocks. The fund added 72,300 shares, a 5% increase, to its BOSS Zhipin position, raising the value of this holding from $28 million at the end of June to $38.4 million.
In convertible bonds, Oaktree Capital significantly increased its holdings of Li Auto convertible bonds by 121%, JD.com convertible bonds by 93%, and Trip.com convertible bonds by 6%.
David Tepper executes strategic rebalancing while maintaining heavy positions
Appaloosa Fund also implemented a refined rebalancing strategy in the third quarter. The fund significantly increased its Baidu holdings by 420,000 shares to 1 million shares, raising the value of this position from $53.6 million in the previous quarter to $137.7 million.
Meanwhile, Appaloosa liquidated its entire stake in KE Holdings worth $26.6 million and reduced its holding in Alibaba by approximately 617,000 shares, a decrease of 9%. However, it still maintains a significant position valued at $1.15 billion. The fund also cut its stakes$PDD Holdings (PDD.US)$in JD.com by 10% and 11%, respectively.
These portfolio adjustments reflect Tepper's recalibration of exposure to China, indicating a moderate adjustment in its commitment to Chinese assets. Notably, according to a Wall Street Wisdom article, billionaire hedge fund founder David Tepper had previously exclaimed 'buy all Chinese assets' in September last year.
Bridgewater Associates Fully Exits U.S.-Listed Chinese Stocks Market
Bridgewater Associates maintained a zero-exposure strategy to U.S.-listed Chinese stocks in the third quarter, continuing its complete avoidance stance since the second quarter.
The fund liquidated its $1.4 billion portfolio of U.S.-listed Chinese stocks in the second quarter, including core holdings such as Alibaba, JD.com, and Baidu,$NIO Inc (NIO.US)$and$Yum China (YUMC.US)$among other key positions.
The scope of the sell-off also encompassed $TAL Education (TAL.US)$ 、 $HWORLD-S (01179.HK)$ , Beike, and$Autohome (ATHM.US)$among other companies. This marks Bridgewater Associates' first complete exit from US-listed Chinese stocks in many years.
Editor /rice