Appaloosa Management, the hedge fund firm founded by David Tepper, significantly increased its stakes in China-related stocks and exchange-traded funds (ETFs) last quarter, ahead of the recent AI-fuelled rally in the country’s equity markets, according to a report by Bloomberg.
The report cites a regulatory filing made on Monday as revealing that Tepper, who made headlines in September by urging investors to buy “everything” tied to China, expanded Appaloosa’s holding in e-commerce giant JD.com by approximately 43% during the fourth quarter. He also increased the fund’s stake in Alibaba Group Holding by 18%, cementing it as the firm’s largest holding, accounting for 16% of its $6.4bn portfolio.
These moves came during a turbulent period for Chinese equities, marked by wavering investor sentiment. Following Beijing’s stimulus efforts in late September, Chinese stocks initially surged but lost momentum in subsequent months due to concerns over limited fiscal measures, a sluggish economic recovery, and ongoing property sector challenges. During the fourth quarter, Alibaba’s stock fell 20%, while JD.com dropped 13%.
In addition to increasing stakes in JD.com and Alibaba, Tepper expanded exposure to other China-focused assets, including the KraneShares CSI China Internet ETF, the iShares China Large-Cap ETF, and individual companies such as Baidu and KE Holdings. By the end of December, Chinese stocks and ETFs accounted for 37% of Appaloosa’s portfolio by market value, largely unchanged from the previous quarter.
Tepper declined to comment on the investments.
China’s equity markets have shown renewed strength early this year, with some benchmarks outperforming their US and European counterparts. The surge has been fuelled in part by the success of DeepSeek’s artificial intelligence model, which has enhanced the country’s standing in the global AI race and drawn investor attention back to Chinese tech firms.
The Hang Seng Tech Index, which includes many of China’s leading tech firms, entered a bull market last week, while the Hang Seng China Enterprises Index is nearing its October peak. Alibaba, which is working on its own AI initiatives, has seen its stock rise nearly 30% since the start of the year. Analysts believe Alibaba’s more diverse international operations may help it weather potential revenue disruptions from the ongoing US-China trade tensions better than its domestic peers.
