Tiger Global is reportedly halting new investment in Chinese stocks after President Xi Jinping's power grab
- Tiger Global Management is pausing future stock investments in China, The Wall Street Journal reported Friday.
- The hedge fund heavyweight is monitoring developments following the start of President Xi Jinping's third term as China's leader.
Tiger Global Management is pausing future stock investments in China, The Wall Street Journal reported Friday, with the hedge fund heavyweight making the move as it monitors developments with the start of President Xi Jinping's third term.
The firm's hedge and long-only funds have been cutting exposure to China this year, shrinking the percentage of Tiger Global's portfolio in the country from the mid-teens to mid-single digits, the report said, citing people familiar with the matter.
Tiger Global, known for snapping up hard-hit Chinese internet stocks in 2022, is taking a wait-and-see approach to Chinese investments until Xi's next public statements. Xi last month was appointed to a historic third term as China's leader, extending his authoritarian rule over the world's second-largest economy.
The firm, led by Chase Coleman, sees the potential that Xi's continued leadership will result in persistent geopolitical tensions and the continuation of the country's Zero Covid policy which centers on lockdowns and quarantines, WSJ reported. The firm also sees the possibility that Xi will oversee stimulus efforts aimed at China hitting its economic targets.
The Chinese market in the past few years has become difficult for investors to navigate. COVID lockdowns have hurt businesses and Chinese regulators cracked down on the technology sector last year. Meanwhile, tensions between China and the US have intensified.
Hong Kong's Hang Seng Index has lost about 44% since the end of 2020 through Thursday, compared with the S&P 500's decline of less than 1%, WSJ said.