Alluvium Asset Management, an asset management company, released its “Conventum – Alluvium Global Fund” third-quarter 2024 investor letter. A copy of the letter can be downloaded here. The equity market continued its rally in the third quarter. The Fund was up 4.3%, 8.7% and 4.6% in EUR, USD and AUD terms, in the quarter. In addition, please check the fund’s top five holdings to know its best picks in 2024.
Conventum – Alluvium Global Fund highlighted stocks like Alibaba Group Holding Limited (NYSE:BABA), in the third quarter 2024 investor letter. Alibaba Group Holding Limited (NYSE:BABA) provides technology infrastructure and marketing reach. The one-month return of Alibaba Group Holding Limited (NYSE:BABA) was -13.64%, and its shares gained 18.38% of their value over the last 52 weeks. On December 3, 2024, Alibaba Group Holding Limited (NYSE:BABA) stock closed at $85.68 per share with a market capitalization of $207.178 billion.
Conventum – Alluvium Global Fund stated the following regarding Alibaba Group Holding Limited (NYSE:BABA) in its Q3 2024 investor letter:
“On 24 September the People’s Bank of China unveiled a massive three part stimulus package involving: (1) slashing the amount of cash banks need to hold in reserve and lowering the main policy interest rate; (2) cutting mortgage rates on existing home loans by 0.5% and reducing down payment requirements for second homes from 25% to 15%; and (3) supporting equity markets by a USD 114b lending pool to encourage companies to buy back shares and non-bank financial institutions to buy local equities (which may be expanded by the same amount two more times)5 . We are flabbergasted. But we shouldn’t be. After all, these types of arrangements have been all too common over the last 15 years. The local equity markets responded with gusto, and for the last week of the quarter the CSI 300 Index (Shanghai and Shenzen listed companies) was up 25.1%. Alibaba Group Holding Limited (NYSE:BABA) was not lost in all this, and returned 26.8% over that one week period. But Alibaba had already performed well so during the whole September quarter it was up a staggering 56.0%. As a result, Alibaba is no longer the cheap stock it once was. It now trades at a premium to our valuation – a valuation which admittedly had been progressively reduced over our holding period as a result of deteriorating business fundamentals. As a result of Alibaba’s significant outperformance, by the end of the quarter it had reached 3.7% of the Fund. We are weighing up our options here, considering the relative risk.”
An e-commerce platform displaying a wide range of products to customers online.
Alibaba Group Holding Limited (NYSE:BABA) is in 23rd position on our list of 31 Most Popular Stocks Among Hedge Funds. As per our database, 115 hedge fund portfolios held Alibaba Group Holding Limited (NYSE:BABA) at the end of the third quarter which was 91 in the previous quarter. Alibaba Group Holding Limited’s (NYSE:BABA) consolidated revenue for fiscal second quarter of 2025 was RMB 236.5 billion, a 5% rise from previous year’s same quarter and consolidated adjusted EBITDA decreased 5% year-over-year to RMB 40.6 billion. While we acknowledge the potential of Alibaba Group Holding Limited (NYSE:BABA) as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is as promising as NVIDIA but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
In another article, we discussed Alibaba Group Holding Limited (NYSE:BABA) and shared the list of best stocks to buy for long term growth. In addition, please check out our hedge fund investor letters Q3 2024 page for more investor letters from hedge funds and other leading investors.
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Disclosure: None. This article is originally published at Insider Monkey.