Ray Dalio’s Bridgewater Associates is betting at least $6.7 billion that some European stocks will fall, making the hedge fund the largest short-seller in the Europe.
According to Bridgewater’s public disclosures, the Connecticut-based fund has bet against 21 European companies so far, in sectors ranging from finance to energy.
Among its biggest short bets are semiconductor-equipment supplier ASML Holding NV ($1 billion), energy company TotalEnergies SE ($705 million) and drugmaker Sanofi SA ($646 million).
The following banks, Banco Santander SA, BNP Paribas SA and Banco Bilbao Vizcaya Argentaria SA and Intesa Sanpaolo SpA are also in the list of Bridgewater’s short positions, as well as insurance companies Allianz SE, ING Groep NV and AXA SA, according to Bridgewater.
In total, Bridgewater has 21 short bets against European companies, but the number of positions could be even larger, as investment firms aren’t required to disclose smaller bets.
In addition, the positions could be part of a broader hedging strategy for the firm, as it isn’t yet clear if the goal is purely to profit from slumping stocks.
Bridgewater’s European short-selling follows even bigger wagers in recent years. In 2020, it made a $14 billion bet against stocks there after building a $22 billion short position in 2018.
In the current market environment, Dalio has urged investors to stay away from cash amid high inflation, and also warned that stocks looked even less promising.
“Of course cash is still trash,” Dalio told CNBC in May. He added, “equities are trashier,” and that “real-return assets” are the best investments.
In a Thursday interview with newspaper La Repubblica, Dalio explained that he’s turning to assets that can protect against inflation, while avoiding debt assets and countries that could be hit by geopolitical turmoil.