Alibaba Is A Favorite Holding Even For U.S.-Focused Funds
There's plenty of news coming from the World Economic Forum, taking place in Davos, Switzerland. On Friday, Jack Ma, executive chairman of Alibaba Group Holding Ltd (NYSE: BABA), speaking at a forum in Davos said he was not concerned about a slowdown in China's annual growth rate – the slowest rate in more than two decades.
Alibaba is the world's largest e-commerce company, with a market capitalization of nearly $258 billion. It's a newly public company, with its American Depositary Receipts making their debut in September, following a whopping $25 billion initial public offering (IPO).
The firm plans a big move into the U.S. market this year.
As with any stock, it is institutional ownership that moves prices. With an IPO of that size, plenty of funds were getting in on the act.
Related Link: Why Is Amazon Still Unable To Post Big Profits?
T. Rowe Price
The largest mutual fund owner of Alibaba shares is the T. Rowe Price Growth Stock Fund (MUTF: PRGFX). The fund owns 2.20 percent of Alibaba shares, totaling 3.03 percent of fund assets. Even though that is a fairly sizable holding, Alibaba shares outstanding equal nearly 2.5 billion.
The T. Rowe Price Growth Stock Fund holds mostly domestic large-caps, but when a high-profile offering like Alibaba comes around, many funds – even those that typically invest in other asset classes – get in line for shares.
Alibaba doesn't even rank among the fund's largest holdings, all of which are large, U.S. based firms, including Amazon.com, Inc. (NASDAQ: AMZN), Priceline Group Inc (NASDAQ: PCLN) and Google Inc (NASDAQ: GOOGL)(NASDAQ: GOOG).
American Funds
Another actively managed, large fund with a significant Alibaba holding is American Funds The Growth Fund of America(R) Class A (MUTF: AGTHX). As the name suggests, this fund has a domestic focus, but current holdings include 8.4 percent non-U.S. stocks.
Top holdings in this fund include Amazon.com, Gilead Sciences, Inc. (NASDAQ: GILD), Google, Home Depot Inc (NYSE: HD) and EOG Resources Inc (NYSE: EOG).
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