Alibaba Takes Prominent Position Among e-Commerce Stocks Preferred by Hedge Funds

Alibaba Group Holding Limited (NYSE: BABA) has taken a prominent position among the e-commerce stocks hedge funds prefer the most. The Chinese e-commerce giant and other players in the country’s online trade sector have seen their stocks appreciate in recent years despite the macroeconomic uncertainties facing China. Alibaba’s performance helped it rank third among the e-commerce stocks most preferred by hedge funds.

Hedge funds typically invest in Alibaba stock, as the technology and e-commerce business runs several virtual markets that serve small business owners (SMEs) and consumers. The Chinese firm’s dealings in digital media, entertainment, logistics, and cloud computing spreads out the risk associated with its stock and makes it even more attractive to hedge funds.

AliExpress supplies a wide variety of items at affordable prices and currently has more than 150 million users in 190 countries. Now that the platform also hosts local merchants, its customers can also meet their supply needs within the AliExpress app, allowing it to retain as much market share as possible.

Alibaba’s strategies designed to boost shopping experiences and facilitate faster product deliveries help users purchase supplies directly from factories on the platform. As a result, the Alibaba International Digital Commerce Group segment’s revenue hit $4.03 billion, a year-over-year increase of 32%.

In total, all of Alibaba Group’s retail platforms have more than 1 billion users across the globe. The Group has also carved out 40% of China’s e-commerce market for itself, estimates by Hong Kong’s DBS Bank show, and is predicted to experience notable growth even as the country faces economic turmoil and competition in the e-commerce space intensifies.

Experts say attempts by Beijing to stimulate the economy could lead the e-commerce sector’s performance to surpass expectations. As Chinese e-commerce stocks appreciate amidst economic stimulus from the government, international e-commerce companies from other countries will also have to increase their sustainable growth strategy investments to keep up with China.

Aside from AliExpress and Alibaba’s other online marketplaces, the firm has made a killing in the cloud storage business. It is now one of the largest cloud storage providers on the globe alongside tech and e-commerce giants like Google and Amazon. Furthermore, Alibaba recently had a successful showcase of its AI-assisted cloud broadcasting technology during the Paris 2024 Olympic Games.

Patient Capital Management noted in its investor letter for Q3 2024 that Alibaba Group’s stock gained by 47% the quarter after Beijing announced an unexpectedly robust stimulus program to bolster the country’s economy.

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