Is Ray Dalio Running A Ponzi Scheme? $TSO $PFE $LII

Is Ray Dalio running a Ponzi Scheme? The title of this article may be a little hyperbolic but it is a fact that the performance of Ray Dalio’s stock picks doesn’t match the reported performance of his hedge fund. Here is what WSJ said about Dalio’s performance on Aug 11th:

“Ray Dalio’s Bridgewater Associates LP has scored gains of more than $3.5 billion, or about 5%, in its flagship hedge fund just in the past week, according to investors. The $71 billion fund now is up more than 20% this year, investors said, making it among the best performers in the hedge-fund business. The gains are partly due to a spike in safe-haven investments, such as gold, Treasury bonds and the Swiss franc, in which Bridgewater has sizable positions.”

We don’t think Ray Dalio is running a Ponzi scheme but it’s clear to us that Ray Dalio isn’t a great stock picker. WSJ reports that Dalio’s flagship fund returned 5% during the first week of August. Unfortunately his top stock picks underperformed the S&P 500 index by more than 1 percentage point that week. The underperformance is about 2 percentage points since the end of June. Under these circumstances we can’t recommend our readers to monkey Ray Dalio’s stock picks.

During the first week of August gold gained around 2.2% and long-term treasury ETF (TLT) gained 4.8%. Ray Dalio probably owes his success to his macro calls and his investments in bonds, golds and currencies this year. Nevertheless, we processed his latest 13F filing and prepared the following table displaying Ray Dalio’s top stock picks. He also initiated brand new positions in Tesoro Corp (TSO), Pfizer (PFE), and Lennox International (LII). Here are Ray Dalio’s top stock picks: