Billionaire David Tepper's Big Bet on China: Why He's ALL IN on These Stocks & ETFs
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David Tepper, the billionaire hedge fund manager of Appaloosa Management, has significantly increased his exposure to Chinese stocks, particularly in the tech and e-commerce sectors, as part of his contrarian investment strategy. His portfolio now includes 37% China-related assets, with major holdings in the following:
Key Chinese Stock Holdings
Alibaba (BABA): Tepper’s largest position at 15.5% of his portfolio, with an 18% increase in Q4 2024. The e-commerce giant’s strong earnings and growth potential drove this bet.
JD.com (JD): Appaloosa raised its stake by 43% in Q4, making it the second-largest China bet at ~5% of the portfolio. JD.com’s expansion into China’s $200 billion food delivery market adds growth appeal.
Baidu (BIDU): A new addition representing 7% of the portfolio, reflecting Tepper’s confidence in Baidu’s AI capabilities and search-engine dominance.
PDD Holdings: Increased by 1%, capitalizing on PDD’s success with budget-friendly platforms like Temu, which disrupted U.S. discount retailers.
China-Focused ETFs
iShares China Large-Cap ETF (FXI): Position boosted by 14% in Q4, emphasizing large-cap Chinese equities.
KraneShares CSI China Internet ETF (KWEB): Stake raised by 21.5%, targeting China’s internet sector.
Context and Strategy
Tepper’s bets align with his history of contrarian moves, as Chinese stocks rebounded in early 2025 despite geopolitical tensions and earlier economic concerns. His bullish stance reflects confidence in China’s AI advancements (e.g., DeepSeek’s breakthroughs) and undervalued tech stocks compared to U.S. peers. Notably, he dismissed hedging these positions, stating, “My hedge is I don’t care”.
Q&A
Why did David Tepper double down on his Chinese stock bets
David Tepper increased his Chinese stock exposure due to historically low valuations and confidence in China’s long-term growth potential despite short-term risks. Key factors driving his strategy include:
- Undervalued tech stocks: Chinese equities traded at a significant discount compared to U.S. peers (e.g., CSI 300 Index priced at ¼ the book value of Nasdaq Composite) despite double-digit earnings growth.
- AI advancements: Breakthroughs like DeepSeek’s AI model demonstrated China’s innovation potential despite U.S. chip export restrictions.
- Contrarian opportunity: Tepper capitalized on widespread investor pessimism, stating China’s valuation gap would close once global markets recognized its competitive edge in sectors like e-commerce and AI.
- Government stimulus: Beijing’s fiscal support pledges in late 2024 reignited optimism for economic recovery.
What other Chinese stocks does David Tepper hold
Tepper’s China-focused portfolio includes six major holdings and two ETFs:
| Stock/ETF | Portfolio Weight | Q4 2024 Change |
|---|---|---|
| Alibaba (BABA) | 15.5% | +18% |
| JD.com (JD) | ~5% | +43% |
| Baidu (BIDU) | 7% | New position |
| PDD Holdings | 8% | +1% |
| KE Holdings | Not specified | +18% |
| ETFs | ||
| iShares China Large-Cap (FXI) | - | +14% |
| KraneShares CSI China Internet (KWEB) | - | +21.5% |
How has Tepper's investment in Chinese stocks performed recently
Tepper’s China bets rebounded sharply in early 2025 after mixed 2024 results:
- Hang Seng Tech Index rose 16% YTD (2025), driven by AI optimism and export competitiveness.
- Alibaba surged nearly 30% in 2025 after launching its AI model, contributing to Tepper’s largest position.
- PDD Holdings gained traction globally via Temu, disrupting U.S. discount retailers like Dollar General.
- Earlier volatility: A late-2024 stimulus rally faded due to slow policy implementation, but Tepper maintained his 37% China allocation, which is now paying off.
What are the risks associated with investing in Chinese stocks according to Tepper
While Tepper dismisses hedging (“My hedge is I don’t care”), risks include:
- Geopolitical tensions: Potential U.S. tariffs (e.g., Trump’s proposed 10% levy) and export restrictions on advanced chips.
- Regulatory uncertainty: Beijing’s unpredictable tech crackdowns (e.g., 2020–2022) and weak consumer spending.
- Economic headwinds: Deflationary pressures and a struggling property sector despite 5.4% GDP growth in Q4 2024.
- Temu’s regulatory exposure: PDD’s discount platform faces scrutiny over duty-free import loopholes in Western markets.
Tepper’s strategy relies on China’s valuation discount narrowing as global investors pivot back to its markets, though this requires sustained economic stabilization and reduced U.S.-China friction.
Disclaimer: This post is for informational purposes only and is not investment advice. Stocks or financial products mentioned may carry significant risks. Please make investment decisions carefully and at your own risk.
Best of luck with your investments!