5 Sep

Why Druckenmiller Is Optimistic about Chinese Consumer Stocks

WRITTEN BY Sarah Sands FEATURED IN Active Management: Mutual Funds, Closed-End Funds, Hedge Funds

Stanley Druckenmiller’s recent activity

Stanley Druckenmiller, a legendary investor in the hedge fund industry, discussed his buying and selling activity in 2Q17 along with his interest in technology stocks and certain Chinese stocks in an interview with CNBC.

Why Druckenmiller Is Optimistic about Chinese Consumer Stocks

According to the recent 13F filing, Stanley Druckenmiller’s firm, Duquesne Family Office, took a position in several Chinese stocks like Yum China (YUMC) and Alibaba (BABA), reflecting Druckenmiller’s optimism surrounding Chinese consumer stocks.

Druckenmiller’s stance on China at the 2016 Sohn Investment Conference

Last year, at the 2016 Sohn Investment Conference, Druckenmiller said that he had a bearish stance on China (FXI) (YINN). He was concerned about the Chinese economy due to its rising credit level. He also warned at that time that China’s growing debt level could be a major obstacle for the global economy (ACWI) (VTI).

However, in the past eight months, the Chinese government has taken various steps to control the credit level in the economy (ASHR) (MCHI). It’s mainly focusing on transforming China into a consumer-based economy from an export-oriented economy.

Druckenmiller’s position in Yum China and Alibaba

Druckenmiller’s firm bought 710,200 shares in Chinese e-commerce giant Alibaba (BABA) in 2Q17. Alibaba represents nearly 5.4% of Duquesne Family Office’s portfolio as of 2Q17. It was the firm’s top purchase in 2Q17. The firm also bought 597,200 shares in Yum China (YUMC) in 2Q17. Yum China represents nearly 1.3% of Duquesne Family Office’s portfolio as of 2Q17.

In the next part of this series, we’ll analyze Stanley Druckenmiller’s largest sector holdings in 2Q17.

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