Ray Dalio’s Bridgewater Associates, a giant in the hedge fund world, has made some significant portfolio changes. They’re betting big on gold and the Chinese tech giant Alibaba, while scaling back their investment in the US stock market.
Cutting Back on Stocks, Buying Gold
Bridgewater reduced its holdings in the SPDR S&P 500 ETF, a fund that tracks the performance of the S&P 500. This means they’re less invested in the overall US stock market. At the same time, they significantly increased their investment in gold, boosting their holdings in the SPDR Gold Shares ETF (GLD) by about 33%, a total investment of roughly $340 million. Dalio has previously expressed concerns about a potential decline in the US dollar and the possibility of stagflation (high inflation, high unemployment, and slow economic growth). This gold investment is seen as a hedge against these economic risks.
Huge Alibaba Investment
The big surprise? Bridgewater massively increased its stake in Alibaba, the Chinese e-commerce giant. Their investment jumped over 3,000%, totaling approximately $680 million. This makes Alibaba one of Bridgewater’s top holdings. Alibaba’s stock has performed well this year, thanks largely to strong growth in its cloud computing business.
The Bottom Line
In total, Bridgewater invested about $1 billion in gold and Alibaba. This shows a clear shift in strategy, moving away from the US stock market and towards assets seen as safer or with higher growth potential. Remember, this is just one investment firm’s strategy, and it’s not financial advice.