MW As Dalio gets out of Bridgewater, Bridgewater gets out of China

By Jules Rimmer

Hedge-fund giant exits stake in Alibaba as well as ETFs tied to China

Ray Dalio has been a long-term bull on China but in recent years this hurt performance.

It was confirmed at the end of July that Ray Dalio sold down his remaining stake in Bridgewater Associates, the firm he founded in his apartment fifty years ago. As he was leaving, Bridgewater dumped its exposure to China, the market on which self-proclaimed Sinophile Dalio was a long-term bull.

In recent years, Bridgewater's performance has been sub-par. Its flagship Pure Alpha fund only returned 5.9% in the five years ending December 2024, though more recent reports indicate it's had a strong first half.

It's not clear whether Dalio's enthusiasm for things Chinese was responsible for the sub-par returns but clearly the bear market that began after the China Communist Party's tech crackdown around 2020 was detrimental to a fund with big positions in U.S.-listed Chinese stocks and a major expansion into money management in China.

Moreover, Dalio was outspoken in his criticism of the trade wars launched by the Trump administration in April but a posting on X articulating his disapproval was appended by the disclaimer that "the views here are my own and not necessarily those of Bridgewater." Corporate America has learned in recent months that open dispute with the government can be bad for business.

As Dalio makes his exit from Bridgewater then and yields his seat on the board, severing all formal contacts, it may not be surprising that U.S. regulatory filings just released reveal Bridgewater liquidated its entire holdings in about sixteen Chinese shares and two exchange-traded funds. These included sizable positions in Alibaba $(BABA)$, Temu parent PDD Holdings $(PDD)$ and Baidu $(BIDU)$ with an estimated value of around $1.5 billion in total.

Ironically, the strategic shift away from China shares comes at a time when the Chinese market is showing signs of life, emerging from the bear market and dismal sentiment that has characterized the 2020s thus far.

China's stock market has been enjoying a steady resurgence. The Shanghai Composite Index CN:SHCOMP is on the cusp of a four-year high and has returned 28% in the last twelve months. With bond yields so low at 1.74% for China's 10-year debt BX:AMBMKRM-10Y, many traders are turning to equities for better performance.

-Jules Rimmer

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August 15, 2025 05:55 ET (09:55 GMT)

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