- Recent 13F deposits show that Ray Dalio Bridgewater Associates bought a job in GameStop (NYSE:EMG) Inventory
- The hedge fund also bought a large position in stocks of rival memes AMC Entertainment (NYSE:CMA)
- This could signal to the market that the hedge fund favors a risk-based approach to stocks
It’s 13F deposit season again – one of my favorite times of every quarter. Besides earnings, 13F filings provide another catalyst that investors can jump on to support their own individual theories on particular stocks. For investors in GameStop (NYSE:EMG), there is actually good news in this regard today.
The largest hedge fund in the world, Bridgewater Associatesannounced a stake in GameStop and AMC Entertainment (NYSE:CMA) in the last trimester. Apparently, the stakes in these two companies were worth just under $700 million each.
GME and AMC stocks are two of the riskiest stocks in the market, so this move is interesting. Perhaps Bridgewater sees these companies as highly leveraged “option type” stocks to buy for exposure to bullish rallies. Either way, it’s clear that Ray Dalio is increasingly optimistic about the market’s short-term outlook.
Dalio appears to have a good grasp of the near-term direction of the market, with most major indices surging during today’s session. That said, let’s dive into some of the other moves Bridgewater has made and how important these stock bets even are to investors.
Ray Dalio’s Bridgewater buys shares of GME and others
Interestingly, these popular retail favorites weren’t the only ones Ray Dalio bought over the past quarter. The hedge fund sold its position in You’re here (NASDAQ:TSLA), while adding exposure to Airbnb (NASDAQ:ABNB) and Berkshire Hathaway (NYSE:BRK-ANYSE:BRK-B).
It looks like the market is trying to make sense of these moves today. On the one hand, risky betting for AMC and GameStop contrasts with sales from the hedge fund of high-growth electric vehicle (EV) maker Tesla. Additionally, the acquisition of Berkshire Hathaway shares may signal that the hedge fund is looking to diversify into the defensive at this time. And perhaps the addition of Airbnb reflects a value-driven choice in this battered market.
Hedge funds are stock pickers, and they pick different stocks for different reasons. Mr. Dalio clearly sees something the market does not with many of these stocks. Indeed, many investors may not agree with Bridgewater’s recent decisions in the last quarter.
I think time will prove whether Bridgewater made the right choices or not. Dalio and his team clearly know what they’re doing, and they seem to be operating with a different mindset than the broader market right now. Perhaps this strategy will give better returns in the short term. We’ll see.
As of the date of publication, Chris MacDonald had (neither directly nor indirectly) any position in the securities mentioned in this article. The opinions expressed in this article are those of the author, subject to InvestorPlace.com publishing guidelines.