Hedge funds, including Bridgewater Associates, Coatue Management, and D1 Capital, boosted their investments in financial stocks during the third quarter, ahead of a sector rally driven by Donald Trump’s election victory, according to a report by Reuters.
The report cites securities filings as showing that Bridgewater Associates, founded by Ray Dalio, expanded its stakes in major financial institutions such as Goldman Sachs, Morgan Stanley, Wells Fargo, Bank of New York Mellon, and Citigroup. The hedge fund also added a new position in Bank of America. As of the end of September, Bridgewater’s largest financial holding was Wells Fargo, valued at $79.6m.
The financial sector has surged in the weeks following Trump’s victory, amid expectations of reduced regulatory burdens on banks. Since September, the KBW Bank Index has risen approximately 17%, with a 12% spike occurring after the 5 November election.
D1 Capital Partners, led by Dan Sundheim, also made significant investments in the banking sector, including a $174.9m stake in Bank of America by the end of the quarter.
Coatue Management, meanwhile, adjusted its portfolio by reducing its holdings in Meta Platforms and Nvidia, while initiating new positions in private equity firms KKR and Blackstone. Coatue acquired 2.7 million shares in KKR, valued at $355m, and 195,969 shares in Blackstone, worth $30m, with both firms set to benefit from a potential rebound in dealmaking activity under a Trump administration.
While quarterly 13-F filings provide a rare glimpse into hedge fund portfolios, they reflect holdings as of 30 September and may not account for changes made since then. This lag makes it unclear whether these funds held their financial positions during the election-driven rally.
