By Anirban Sen
NEW YORK (Reuters) -Wall Street’s largest hedge funds reduced exposure to some Magnificent Seven stocks, including Nvidia, Amazon, Alphabet and Meta, in the third quarter, while placing new bets in sectors such as application software, e-commerce and payments, according to the latest quarterly disclosures from the funds.
Here are key position changes by some of the funds:
BRIDGEWATER ASSOCIATES
Bridgewater Associates, which enjoyed a stellar run during the first nine months of the year as it outperformed all its top peers, slashed its stake in Nvidia by nearly two-thirds to 2.5 million shares and in Alphabet by more than 50% to 2.65 million shares. The firm also trimmed its stake in Amazon.com by 9.6% to about 1.1 million shares and its holdings in semiconductor industry bellwether Broadcom by about 27% to 845,391 shares.
The firm increased its exposure to sectors such as application software and payments, as it upped holdings in names like Adobe, Dynatrace and Etsy.
In a recent note to investors, Bridgewater’s chief investment officers, Karen Karniol-Tambour, Greg Jensen and Bob Prince, warned of mounting risks to the current market stability and the limits of the artificial intelligence boom.
Bridgewater was founded in 1975 by Dalio, who recently sold his remaining stake in the firm. The hedge fund currently has $92.1 billion in assets under management.
DISCOVERY CAPITAL
Discovery Capital, which was founded by Rob Citrone, took new positions in names like Alphabet, steel maker Cleveland-Cliffs, and health insurers Cigna and Elevance Health.
Citrone’s hedge fund, which generated a 52% windfall on its investments last year, has increased its exposure to Latin America as part of a strategy to diversify from U.S. holdings.
For the quarter ended September 30, the fund exited positions in several exploration and production companies in the energy industry such as EQT, Antero Resources and Range Resource, while placing a new bet on oilfield services giant Baker Hughes. Discovery also doubled down on its bet on critical minerals producer Ramaco Resources.
Citrone, who earlier this year picked Mexico’s America Movil as his favorite stock due to its exposure to many countries in Latin America, trimmed his holdings in the company by about 11.5% to 4.68 million shares, valuing the stake at about $98.3 million.
BALYASNY ASSET MANAGEMENT
Dmitry Balyasny’s multi-strategy hedge fund Balyasny Asset Management increased its stake several-fold in iPhone maker Apple, even as others including Berkshire Hathaway trimmed their exposure to the tech giant.
Like a number of its top peers, Balyasny slashed its stake in Amazon by about 41%.
The firm also increased positions in insurers American International Group and Allstate, while taking a new position in digital infrastructure firm American Tower.
TIGER GLOBAL MANAGEMENT
Tiger Global Management, founded and led by Chase Coleman, slashed its stake in Meta Platforms during the third quarter.
During the quarter ended September 30, Tiger Global reduced its holdings in Meta to 2.8 million shares, valuing the stake at about $2.1 billion. The firm dissolved its positions in some other high-profile names including drugmakers Eli Lilly LLY.N, Novo Nordisk NOVOb.CO and cybersecurity firm CrowdStrike CRWD.O.
Tiger Global, an offshoot of famed investor Julian Robertson’s firm and part of a cohort of stock-picking funds popularly known as Tiger Cubs, took new positions in streaming giant Netflix NFLX.O and buy-now-pay-later firm Klarna KLAR.N.
COATUE MANAGEMENT
Several changes in billionaire Philippe Laffont’s Coatue Management’s portfolio were around big AI names.
The firm reduced its holdings in AI industry bellwether Nvidia by 14.1% to 9.9 million shares, joining some other high-profile firms such as Bridgewater and Michael Burry’s Scion Asset Management which have reduced their exposure to the company. Earlier this week, Burry said he would close his hedge fund after warning of an AI bubble in the markets.
The firm also reduced its exposure to tech stocks Tesla, Amazon, CoreWeave and Arm Holdings by 15.1%, 13.9%, 62.2% and 51.2%, respectively, while exiting its positions in Eli Lilly and tobacco giant Philip Morris. However, Coatue upped its stakes in other Big Tech names such as Microsoft and Meta, and increased exposure to e-commerce giant Alibaba.
(Reporting by Anirban Sen in New York; Editing by Megan Davies and Leslie Adler)
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