Ray Dalio, founder, co-chief investment officer and co-chairman of Bridgewater Associates, speaks at the 2019 New Economy Forum in Beijing on Nov. 21, 2019.JASON LEE/Reuters
Bridgewater Associates’ Ray Dalio said on Friday his hedge fund does not have a net bet that the stock market will fall, taking issue with a story published earlier in the Wall Street Journal.
The hedge fund has bet more than US$1-billion that stock markets around the world will drop by March, the Journal said in its report on Friday, citing people familiar with the matter.
The bet, assembled over a span of months and executed by a handful of Wall Street firms, including Goldman Sachs Group Inc. and Morgan Stanley, would pay off for the world’s biggest hedge fund if either the S&P 500 or the Euro Stoxx 50 — or both — declines, the report had said.
The bet is made up of put options, contracts that give investors the right to sell stocks at a specific price by a certain date. The options expire in March and currently represent one of the largest bearish bets against the market, the report added.
“To convey us having a bearish view of the stock market would be misleading,” Mr. Dalio, the firm’s founder and co-chairman, said in a statement.
However, Dow Jones, the publisher of Wall Street Journal, said the article is based on interviews with multiple sources.
“The article does not report, as Mr. Dalio says, that Bridgewater has a ‘net’ bearish position on the stock market,” a spokesman for Dow Jones said.
“The article made clear that the trade could be a hedge for the firm’s significant long exposure to equity markets, among other possibilities.”