Every reporter: Wen Qiao Every editor: Gao Han
According to a report by Bloomberg on July 15, Bridgewater Fund ’s short position in European stocks is reaping huge returns. The decline in European stocks, combined with the worsening economic prospects caused by events such as the European energy crisis and the Russia-Ukraine conflict, has created fertile ground for short sellers.
Since the beginning of this year, the European Stoxx 50 Index has fallen by more than 20%. As of press time, the European Stoxx 50 Index rose 2.45%.
Image source: Yingwei Finance
Since Bridgewater disclosed its short position in European stocks last month, the performance of the European Stoxx 50 Index has lagged behind the major stock indexes in the United States, Britain and Japan.
During this period, the fund’s largest short positions, Total (TTE, stock price 47.58 euros, market value 120.716 billion euros) and Siemens AG (SIE, stock price 99.55 euros, market value 84.295 billion euros), have fallen 12% each. Dutch Semiconductor Equipment Supplier ASML (ASML, stock price 464.75 euros, market value 186.572 billion euros) has fallen 3.3%.
Thanks to the increased market volatility, Bridgewater 's flagship fund Pure Alpha II achieved a high return of 32% in the first half of this year, increasing its annualized return since its establishment in 1991 to 11.4%.
As early as April this year, Bridgewater Funds shorted European and American corporate bonds and bet more than $5.7 billion on short European stocks. Soon after, Bridgewater once again increased its short bet on European stocks, with the bet amount rising to $10.5 billion. According to data provided by the European short information tracking website Breakout POINT, Bridgewater disclosed short positions in 28 companies, including ASML, Total Energy, , Sanofi and SAP, all with a short-selling scale of 500 million. USD and above.
According to Bloomberg, it is unclear exactly when Bridgewater began shorting European stocks, because hedge fund does not have to disclose smaller bets, which means that the scale of Bridgewater’s shorting of European stocks may be much larger than that. .
In fact, this is not the first time that Qiaoshui has shorted European stocks. Judging from Bridgewater’s short-selling history, the fund’s first two large-scale short-selling of European stocks date back to 2018 and the first quarter of 2020.
In 2018, U.S. stocks plummeted, triggering global stock market shocks. Bridgewater bet $22 billion on short stocks in Europe. According to a previous report by " Financial Times ", in 2018, when many global assets were declining, Bridgewater's flagship fund Pure Alpha bucked the trend and made a net profit of 14.6%, the best performance in five years.
In 2020, the COVID-19 epidemic hit the global stock market. At that time, Bridgewater bet US$14 billion on shorting European companies, including ASML, which was shorted this time. However, 2020 was a "tragic" year for Bridgewater. According to investment institution LCH Investments, the fund's losses that year reached approximately US$1.21 billion.
Daily Economic News
Daily Economic News
