Michael Barry's investment firm doubled its investments in JD.com Inc and Alibaba Group Holding Ltd in the first quarter as Chinese stocks bottomed out.
JD.com became Scion Asset Management's largest holding after it increased its stake in the e-commerce operator by 80% during the period, according to the company's latest 13F filings. Alibaba added another 50,000 shares, giving it the second-largest position for a total of about $9 million.
Barry became famous with this book. Money short: A spectacular reversal, is moving back into China tech stocks after pulling out of them at some point in 2023. The bet appears to be paying off, as efforts by Chinese policymakers to stave off a rout and signs of improving earnings have spurred a recovery in the troubled market. JD.com's U.S.-listed shares have risen more than 16% this year, while Alibaba has gained about 4.5%.
Baidu's American depositary receipts, in which Burry took an additional $4.2 million in small shares, are still down 7% so far this year.
Global investors are cautiously returning to China's stock market as cheap valuations and policy support from the Chinese government have sent many stock benchmarks into a bull market. Sustained growth in profits is seen as essential for the economic recovery to continue. Tencent Holdings beat profit expectations, while Alibaba reported lower-than-expected profitability.
Barry made a name for himself by predicting the 2008 U.S. housing crash, but in recent years he has repeatedly entered and exited Chinese tech investments. In late 2022, as China was emerging from the pandemic, he bought up New York-listed Alibaba and Jingtocom shares. He eventually closed the position in the second quarter of 2023, but reopened it a few months later.
