Apple Inc. (NASDAQ:AAPL), the first trillion-dollar public company, actually fell behind the NXP Semiconductors NV (NASDAQ:NXPI) on June 30 in terms of tech stock hedge fund ownership. It is presently sitting at 5th position on the list.
After Apple released its second-quarter results in April, not many hedge funds were happy. As a result many of them of the sold the stock, and the list consists of some big names such as Ray Dalio’s Bridgewater Associates, Louis Bacon’s Moore Global Investments, and Matthew Tewksbury’s Stevens Capital Management. And on August 2, Apple became the first publicly-traded U.S Company to hit the $1 trillion mark, after releasing its strong third quarter results.
It is a little strange that a tech company of Apple’s caliber shares are being sold by most of the fund managers this year. If we dig deep into the probabilities, the reason could possibly be attributed to the kind of presence Apple has in China, and the kind of income it generates based on the China market. Now that the relationship between the U.S. and China has soured, it probably might be the right decision taken by the fund managers.
According to Dan Niles of Alpha One Capital Partners, investors should now be really concerned about the trade war going on between the U.S and China before investing in the tech giant as 18% of Apple’s total revenue during the last fiscal quarter (Q3) was generated from the Chinese market.
And this probably might be the reason why Alpha One Capital Partners sold some of its Apple shares in Q2 and this probably might be the reason why most hedge funds have been doing the same in the recent past.