A few days ago, the Bridge Water Fund submitted its latest position report to the US Securities Regulatory Commission, saying goodbye to 2019 with a market capitalization of $9.794 billion, a 14 per cent decline from its position in US stocks in the third quarter of 1919.

Earlier, there were media reports that Pure Alpha, the flagship product of the Bridge Water Fund, did not perform well in 2019 and failed to continue the impressive performance of 2018. It seems that the investment operation in the fourth quarter did not effectively improve the performance, how did the Bridge Water Fund miss the recent booming US stock market?

In addition, Ray Dalio, the founder of the Bridge Water Fund and an old friend of the Chinese people, has spared no effort to advocate Chinese assets since the trade friction between China and the United States. So how does he actually invest in Chinese assets and which Chinese stocks do he prefer?

All these problems can be seen in this position report.

Significantly reduce ETF holdings in emerging markets

First of all, from the perspective of the portfolio as a whole, in terms of position market value on December 31, 1919, the top 19 are all ETF, tracking different indices. The following table details the codes, tracking targets, number of positions, market capitalization and share of the top 10 ETF, as well as their changes compared to the third quarter of 19.

SPY, which tracks the s & p 500, is the largest ETF by market capitalization, reducing its holdings only slightly in the fourth quarter, while SPY grew by 8.3% in the fourth quarter of 1919. Bridgewater apparently didn't miss the index.

The big changes are the three ETF VWO, EWZ and IEMG, which track emerging market indices, and VWO has been reduced by 21% in the third quarter of 19.

In addition, EEM, which was the seventh largest by market capitalization in the third quarter of 1919, lost 71 per cent of its holdings and fell to 16th place in the fourth quarter. And this ETF tracks global emerging markets, and its constituent stocks account for the first and second are BABA and Tencent. The first and second largest constituent stocks of VWO mentioned above are also BABA and Tencent.

These emerging market ETF that have been reduced have all performed quite well in 19Q4, with EWZ growth of 13%, EWZ growth of 11%, EWZ growth of 10%, EWZ growth of 9.2%. If Qiaoshui's holdings were not reduced at the end of the quarter, some of the gains would have been missed.

In addition, it is worth noting that the two pure Chinese-themed ETF MCHI and FXI have been increased to a considerable extent, continuing the previous trend of increasing holdings. Although the overall share is relatively small, it is also a practice of Dalio's bullish view on Chinese assets.

Technology for finance, what is the intention of changing positions?

From the perspective of individual stocks, the Bridge Water Fund ushered in a large-scale adjustment of positions for shares this quarter. The following table lists the top ten stocks with the largest market capitalization of 19Q4 positions.

Among them, there are five banks in the top six. JPMorgan Chase & Co, Bank of America Corporation, Wells Fargo & Co and Citigroup all built new positions in the fourth quarter, while Royal Bank of Canada changed only slightly.

There are far more financial stocks in Jiancang this quarter. Financial companies such as Goldman Sachs Group, Morgan Stanley, Blackrock and Charles Schwab Corp have all bought Qiaoshui. With such a clear-cut layout of the financial industry, Qiaoshui's intention to adjust positions is worth paying attention to.

In addition, technology stocks were abandoned by the bridge. Apple Inc, Alphabet Inc-CL C, Intel Corp and Oracle Corp, who were also held in the third quarter of 1919, were cleared directly without leaving a single share. NVIDIA Corp, Sai Ling Si and so on have been reduced by a large proportion.

What are the consequences of this? Of course, I missed the market where technology stocks continue to hit record highs. Although U. S. financial stocks rose well in the fourth quarter of last year, they were almost as good as those of popular technology stocks.

However, it should be noted that the "science and technology content" of ETF SPY, the largest position in Qiaoshui, is very sufficient. Apple Inc, Microsoft Corp, Amazon.Com Inc, and Facebook Inc are the top four constituent stocks, and Alphabet Inc-CL C accounts for a total of 17.4%. In this way, Qiaoshui may also be trying to balance the portfolio.

In addition, it is worth noting that Qiaoshui also built a position in Tesla, Inc. in the fourth quarter, with a shareholding of 42.484 and a market capitalization of US $17 million. If none of the shares have been sold so far, the market value of the position is already $32.3 million.

Chinese stocks: big ones do not move, small ones increase their positions.

Qiaoshui held a total of 15 Chinese stocks in the fourth quarter of 1919, of which BABA had a market capitalization of US $66 million at the end of 1919.

JD.com, NetEase, Inc, Baidu, Inc. subsequently, the market value of the position is also relatively close. Some popular Chinese stocks are also in Qiaoshui's portfolio. However, on the whole, the market capitalization of these US-listed stocks is relatively small. But some of these changes are noteworthy. The changes of the top stocks in the market capitalization of the positions are relatively small, but the Chinese stocks with smaller market capitalization of the positions have been increased by a large margin.

Pinduoduo increased his position by 11.32% in the fourth quarter, and Qiaoshui has increased its position for two consecutive quarters since it was built in the second quarter of 1919. ZTO Express received a 51% increase in positions in the fourth quarter, and Qiaoshui disclosed Jiancang in the third quarter of 1919. Since the second half of 19 years, ZTO Express has risen nearly 23%.

NIO Inc. increased the position the most, reaching 69.41%. Qiaoshui also began to build its position in the third quarter of 1919. Obviously, all kinds of negative news about NIO Inc. did not scare Qiaoshui off. On December 30th, NIO Inc. released a better-than-expected three-quarter report, which closed up 53% in a single day.

It is also worth noting that Vipshop Holdings Limited, although the number of positions in Qiaoshui changed little in the fourth quarter, it more than tripled in the second quarter of 19. In the following three quarters, Vipshop Holdings Limited's shares soared 58 per cent in a single quarter.

Futu Securities collates for you according to the latest 13F document of Qiaosi.$Bridge Water position (BK2122.US) $Concept section, you can click to view.