Ray Dalio’s hedge fund increases holdings in high-growth stocks despite AI bubble warnings and elevated valuations.
Bridgewater Associates, led by billionaire Ray Dalio, has expanded its positions in growth stocks during the first quarter, citing robust earnings expectations. The S&P 500 Growth index has climbed 9% year-to-date, outpacing the 6% gain in value stocks within the same benchmark.
FactSet projects 23% earnings growth for the full year, supporting the case for growth equities amid monetary policy uncertainties and geopolitical tensions. Goldman Sachs strategists noted that conditions signaling the end of high-valuation bull markets remain largely absent, though some risks are emerging.
Despite Dalio’s caution over a potential AI bubble, Bridgewater’s portfolio maintains significant exposure to growth stocks with strong AI ties. The shift reflects investor confidence in sustained growth momentum despite premium valuations.