Ray Dalio's Bridgewater makes $5.7B wager against European stocks
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Bridgewater Associates, the world's largest hedge fund firm, appears to be the biggest short seller of European stocks, betting more than $5.7B against them, according to regulatory filing data compiled by Bloomberg.
The bets include a $1B position against chip manufacturer ASML Holdings (NASDAQ:ASML) and a $752M wager against TotalEnergies (NYSE:TTE). The closely held firm, run by Ray Dalio, manages about $150B and is the biggest short-seller in Europe, based on the value of its positions, Bloomberg said.
Short sales aim to profit from an expected decline in the stock's value. The investor borrows and sells a stock now with the hopes of buying it back later at a lower price.
The data, though, doesn't indicate whether Bridgewater is aiming to profit from the short sales on their own or is using them as part of a larger hedging strategy.
The news comes as the European Central Bank held an emergency meeting on Wednesday to address market turmoil in the region. The central bank told its staff to come up with a new tool to address fragmentation in eurozone bond yields, or the increasing spread between countries in the region.
YTD, the Stoxx 600 (STOXX) Index has dropped 17%, less than the 20% decline by the S&P 500, as seen in this chart.
For more on short sales, read What Does it Mean to Short a Stock?