Billionaire Ray Dalio’s hedge fund is shedding exposure to the S&P 500 and hedging against the US dollar – while managing to stay on offense.
The latest 13F filings show Dalio’s Bridgewater Associates has lowered its stake in the SPDR S&P 500 ETF, a benchmark fund that tracks the performance of the S&P 500.
That fund now makes up about 8.5% of Bridgewater’s overall portfolio as of the end of March.
Simultaneously, the hedge fund has increased its exposure to SPDR Gold Shares ETF (GLD), an exchange-traded fund that tracks the price of gold bullion, less its expenses.
Bridgewater increased its GLD holdings by about 33%, allocating approximately $340 million in total exposure to the precious metal.
The move comes as Dalio repeatedly warns the US dollar’s decline could eventually trigger stagflation – a dreaded economic outcome marked by high inflation, high unemployment and low economic growth.
But Bridgewater’s portfolio is not merely defensive.
Alongside GLD, the firm has dramatically boosted its position in the Chinese e-commerce giant Alibaba (BABA).
Bridgewater increased its Alibaba holdings by over 3,000%, attaining 5,660,258 shares worth approximately $680 million.
That makes it one of the fund’s top holdings.
Alibaba’s stock has risen approximately 42% year-to-date, driven by strong growth in its cloud computing segment.
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