By Nell Mackenzie, Summer Zhen and Carolina Mandl
London (Reuters) – Global hedge funds wishing to sail on American -Chinese trade tensions amasted Chinese stock betting in the hope of making huge profits if Beijing forms a pact with Donald Trump, or if the rest of the world And China unite against the United States President.
As a lower risk of Paris, they should not be too hard hit, according to several fundamental managers and investment professionals.
The hedge funds currently have the most Chinese stock they have in 12 months, but compared to history, the levels remain low, wrote Morgan Stanley in a first -rate brokerage note on Monday.
The American community of hedge funds, representing most of the industry, currently allocates around 3% of its portfolios to China, said Morgan Stanley.
In comparison, global hedge funds have led around 60% of their trade flows in the United States during the week until February 14, according to a separate note from Goldman.
A relatively robust economy associated with deregulation expectations and tax reductions under Trump continues to strengthen American markets.
China, on the other hand, still fights against a real estate crisis and high debt, which means that hedge funds remain cautious at the allowance of liquidity to the world economy n ° 2.
But the funds that remained away from China lost a net rally in September. Under the hopes of economic recovery, Chinese actions closed in 2024 with their first annual gain since 2020.
This is why some American hedge funds have brought back into Chinese actions, finding good -market means and at a lower risk of doing so.
David Aspell, a portfolio manager of the Macro Hedge Fund of $ 1.7 billion, Mount Lucas, said he had bought purchase options, giving him the right to a stock but only if he touches a certain price. They came at a lower cost because the price they have to reach is evaluated well above the current negotiation price, he said.
He also has an exposure to Chinese index funds and unique actions and estimates that the wind contrary winds will argue, saying that Trump wants a trade agreement with China which serves American interests.
The choice of China
Having promised 60% of prices on Chinese imports before being elected, Trump revised this at 10% since his entry into office.
“China now has the choice. If it will not be in the club, the United States could cut it,” said Aspell.
“At that time, China will have to find other markets to absorb its massive export capacity, which may exist or not.”
Aspell added that it was optimistic, a trade agreement could occur, although the future way could be a jack.
Boaz Weinstein, founder of Capital Management Management of $ 5 billion, noted how certain Chinese actions are negotiated below the levels of cash consumption of the company after the costs, which makes them undervalued.
