Dalio’s Bridgewater Boosts Gold Holdings in SPDR, IShares

(Bloomberg) -- Billionaire hedge fund manager Ray Dalio boosted his holdings in the two largest gold-backed ETFs last quarter before prices of the metal capped the biggest annual gain in seven years.

As of the end of December, Dalio’s Bridgewater Associates, the world’s biggest hedge fund, raised its stake in SPDR Gold Shares, its fifth-largest holding, by 14,091 shares to 3.91 million shares, a U.S. regulatory filing showed Tuesday. Bridgewater also added to its iShares Gold Trust holdings. The increases were among moves that included a cut in an emerging-markets ETF and new short positions as part of an increased wager against European companies.

Assets in exchange-traded funds backed by gold rose for a fourth straight quarter in December, the longest expansion since 2012. The metal advanced 1.8 percent in the fourth quarter. A weaker dollar helped gold post a 14 percent rally last year despite three interest-rate increases by the Federal Reserve. Higher rates typically hurt the appeal of non-interest bearing assets like bullion.

In August, Dalio recommended investors consider placing 5 percent to 10 percent of their assets in gold, citing political and economic risks. Bridgewater’s stake in iShares Gold rose in the fourth quarter by 34,792 shares to 11.3 million shares, according to the filing. On Monday, Dalio said risks of a recession in the next 18 to 24 months are rising.

Mining Positions

Bridgewater boosted its stake in Newmont Mining Corp. to 148,185 shares, while cutting its stake in Barrick Gold Corp. to 160,951 shares. It also reduced its position in Freeport-McMoRan Inc. The hedge fund raised its holding in iron-ore-producer Cleveland-Cliffs Inc. to 3.33 million shares, the filing showed.

Outside of metals and mining assets, Bridgewater slashed its stake in the iShares MSCI Emerging Markets ETF by half to 32.6 million shares, the biggest reduction in its portfolio. The biggest increase was in iShares MSCI Brazil ETF, which was raised by about 924,500 shares to 7.73 million. The stake is Bridgewater’s sixth-largest.

Filings released this month don’t include hedge funds’ current position, which may have changed since December. Prices of the precious metal climbed 3.2 percent in January and are up 0.3 percent this month.

Since the end of December, SPDR Gold has seen outflows of $563 million. Investors were more loyal to iShares Gold, adding $837 million to their holdings so far this quarter.

Money managers who oversee more than $100 million in the U.S. must file a Form 13F within 45 days of each quarter’s end to list those stocks as well as options and convertible bonds. The filings don’t show non-U.S. securities, holdings that aren’t publicly traded, or cash.

©2018 Bloomberg L.P.

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