Asian hedge funds grab Alibaba, the sea after the stock crash

(Bloomberg) — Some of Asia’s largest funds have doubled their positions in Alibaba Group Holding Ltd. and Sea Ltd. in the second quarter after a one-year slump.

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The number of Alibaba shares held by Asia-focused funds increased 311% in the period, while that of Sea jumped 110%. This is based on the analysis of 13F filings of 15 Asian asset managers – including hedge funds Aspex Management (HK) Ltd. and Oasis Management Co. – that have at least $200 million in holdings at the end of the quarter.

Volatile markets have tested hedge funds in Asia. The Nasdaq gauge with heavy exposure to Chinese tech firms has tumbled nearly 67% from a peak in February 2021 as regulatory crackdowns and geopolitical tensions spook investors.

The 13F filing, a quarterly report on U.S.-listed holdings by money managers, provides a snapshot of the quarter-end positions of Asia’s biggest funds, though it offers less insight than their U.S. peers, which have more than its holdings in New York.

A growing number of Chinese tech firms are now also listed in Asia, and the shift from US-listed to Asian-traded stocks may explain some of the changes in positions. US-listed Asian companies tend to be concentrated in the technology and healthcare industries, meaning the filings can give a biased picture of the funds’ industry exposure. The documents also do not disclose short-selling activities or the timing of trades.

The following charts give some overview of their holdings at the end of the quarter.

Big Bets:

Companies in e-commerce, shipping, solar energy and electric vehicle makers made up the funds’ 20 largest combined holdings by market value at the end of June.

While Inc. topped the rankings, Alibaba represented the largest percentage increase in combined positions, measured by number of shares, since the previous quarter.

Alibaba’s US shares have tumbled 72% since October 2020. Sea is down 82% from its October 2021 high.

Semiconductor trading is losing luster, with some Asian funds selling Advanced Micro Devices Inc., the second-largest maker of the chips that run computers, Nvidia Corp. and Taiwan Semiconductor Manufacturing Co.

The semiconductor industry is bracing for what could turn out to be its worst decline in a decade or more, due to a drop in demand for consumer electronics.

Hermes Li’s Hong Kong-based Aspex, which managed $8 billion earlier this year, went the other way. His fund bought shares in Nvidia and TSMC in the quarter before TSMC raised its 2022 revenue forecast and said it would cut expansion costs in mid-July.

Crowded Deals:

Food and express delivery, semiconductors, e-commerce, electric vehicles and online brokerage services were among the busiest trades.

Doubling down:

Seven managers held or increased their positions in Chinese online real estate platform operator KE Holdings Inc., whose U.S.-traded shares jumped 45% in the quarter.


Nvidia and TSMC were cut by the most funds in the three months to June, joining Alphabet Inc. and Microsoft Corp. in the global technological march.

Some funds remained skeptical about the prospects of Chinese e-commerce companies, leading to cuts in Alibaba and

Aspex, CoreView Capital Management Ltd., Oasis Management Co., Ovata Capital Management Ltd., Perseverance Asset Management declined to comment.

HHLR Advisors Ltd., SeaTown Holdings, FengHe Fund Management, Franchise Capital Management Ltd., Greenwoods Asset Management Hong Kong Ltd., MY.Alpha Management HK Advisors Ltd., Oxbow Capital Management (HK) Ltd. did not respond to emails seeking comment.

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