Equities

Burry Ups JD.com by 80%, Alibaba; Bets on Gold Amid Tech Rebound

Burry Increases Bets on JD.com and Alibaba, Invests Over $10M in Gold, Showcasing Diversified Strategy Amid Market Recovery

By Alex P. Chase

5/15, 23:31 EDT
AMC Entertainment Holdings, Inc.
Alibaba Group Holding Limited
Citigroup, Inc.
HCA Healthcare, Inc.
JD.com, Inc.
Sprott Physical Gold Trust ETV
Block, Inc.
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Key Takeaway

  • Michael Burry's Scion Asset Management increases stakes in JD.com by 80% and Alibaba by 50,000 shares, signaling strong confidence in Chinese tech recovery.
  • Burry invests over $10 million into Sprott Physical Gold Trust, highlighting gold as a strategic hedge amid market volatility.
  • Diversification across sectors including technology, healthcare, and financial services underlines Burry's adaptive investment approach.

Burry's Strategic Moves

Michael Burry's Scion Asset Management has notably increased its investments in Chinese technology giants JD.com Inc and Alibaba Group Holding Ltd. during the first quarter, as indicated by the latest 13F filings. Scion Asset Management raised its stake in JD.com by 80%, making it the firm's top holding, while Alibaba became its second-largest position after an addition of 50,000 shares, bringing the total value to approximately $9 million. This strategic adjustment comes as Chinese equities show signs of recovery, with JD.com's US-listed shares rising over 16% and Alibaba's by about 4.5% this year. Despite a mixed performance among Chinese tech stocks, with Baidu Inc.’s American Depositary Receipts down 7%, the sector has attracted global investors back to the Chinese market, buoyed by favorable valuations and policy support from Beijing.

Gold as a Safe Haven

In a significant move, Michael Burry has allocated over $10 million into the Sprott Physical Gold Trust (PHYS), marking it as his largest investment for the quarter. This investment reflects Burry's confidence in gold as a safe haven, especially as gold prices have surged to new highs amid inflation concerns and geopolitical tensions. The Sprott Physical Gold Trust, a closed-end fund holding physical gold bullion, trades at a 1.67% discount to its net asset value, slightly above its 52-week average discount. This move underscores Burry's diversified investment strategy, balancing between precious metals and equities to hedge against market volatility.

Diversification and Market Adaptation

Burry's investment portfolio showcases a diversified approach, with significant positions not only in gold and Chinese tech stocks but also in companies like HCA Healthcare, Citigroup, and Block. This diversification strategy highlights Burry's ability to identify value across various sectors, from technology and healthcare to financial services. Meanwhile, Bill Gross, another prominent investor, has ventured into options trading on meme stocks such as GameStop Corp. and AMC Entertainment Holdings Inc., employing a strategy of selling straddles to capitalize on the stocks' high volatility. Gross's move into speculative trading on meme stocks, despite his criticism of treating the stock market like a casino, illustrates the adaptability and varied strategies employed by investors in navigating the current market dynamics.