Baupost Cuts Alphabet Investment Before Market Drop
- Baupost's Seth Klarman, managing a $28 billion hedge fund, reduced Alphabet stake by 64% to $195 million.
- The sell-off happened at the end of June, impacting the Google parent company's investment.
- This move reflected a substantial change in Baupost's investment strategy towards Alphabet.
Seth Klarman, the prominent hedge fund manager of Baupost Group, has significantly reduced his investment in Alphabet, the parent company of Google and YouTube, according to a recent SEC filing. By the end of June, Klarman had cut his Alphabet stake by 64%, bringing it down to approximately $195 million, which now ranks as his seventh largest holding. This decision comes after Alphabet had been Baupost's second largest investment in the first quarter of 2024. The timing of Klarman's divestment appears prescient, as Alphabet's stock, which had surged over 20% in the second quarter, has since experienced a downturn, losing more than 12% in the current quarter. This decline reflects a broader trend of investors moving away from high-performing technology stocks, often referred to as megacaps, as market dynamics shift. Klarman, known for his adherence to value investing principles inspired by Benjamin Graham, has earned comparisons to Warren Buffett, earning him the nickname "The Oracle of Boston." His investment strategies and insights have garnered significant attention, with his book selling for thousands of dollars online. Despite the reduction in his Alphabet holdings, Klarman continues to maintain substantial investments in other companies, including Liberty Global, Fidelity National Information Services, and Just Eat Takeaway. Additionally, he has recently acquired shares in health insurer Humana and a small stake in Capri Holdings, which is currently involved in an $8.5 billion acquisition by Tapestry.