Thanks to Uncle David for forwarding a CNBC article on how famed hedge fund manager Stan Druckenmiller raised his stakes in Chinese companies in the last quarter. According to recent 13-F filings, his firm Duquesne Capital bought Chinese consumer and tech stocks in the second quarter.
The billionaire's hedge fund took a stake in Chinese e-commerce giant Alibaba of 710,000 shares, according to a required 13-F filing with the Securities and Exchange Commission Monday. The hedge fund also took a 597,000-share stake in Yum China.
The firm increased its stake in Alibaba rival JD.com by 721,000 shares to 1.36 million shares, and added 500,000 shares of Chinese travel services company Ctrip for a 1.41 million share stake, the filing showed.
This is a change in tone from Druckenmiller as a year ago, he was very concerned about all the debt Beijing binged on over the past decade. He pointed to China spending trillions of dollars on stimulus projects that led to overcapacity. He said that China is in the midst of an "extremely rare and quite dangerous" explosion of debt. I guess his feelings have changed. In our opinion, China has done an incredible job of transitioning away from a manufacturing dominated economy into a service economy. They are no longer a me too economy that can only thrive with low wage manufacturing jobs. Today, China has a thriving tech sector that competes with Silicon Valley. It seems to us that Druck believes the same as he is tilting his holdings to Chinese tech and consumer stocks.
Do you own any Chinese stocks? Are you missing out on the dynamic Chinese economy?