UBS: Amazon, Alibaba Are The Most Crowded Trades Of The Year

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December 30, 2016 8:07am NASDAQ:AMZN

NASDAQ:AMZN | News, Ratings, and Charts

From Tyler Durden: While everyone in the world appears convinced that (and positioned for) bond yields go higher, stocks go higher, gold goes lower, and risk has been vanquished, UBS notes that the world’s largest, most active overweight crowded trade is in Amazon.com stock (followed closely by UnitedHealth).


At 175x P/E what could go wrong?

Notably, while Amazon is the most crowded long in the developed markets, Chinese e-commerce behemoth Alibaba is the most overcrowded in global emerging markets:

UBS explains: How do we measure the active positions? Using the institutional ownership data provided by FactSet, we form an active trading portfolio by aggregating positions across global active managers. Essentially, we sum up all the holdings in dollar value across all the active managers and calculate the weights of stocks in this active trading portfolio. We then compare this weight with the relevant equity index benchmark to form the active weight.

This situation is well worth monitoring as we head into 2017, with the two largest e-tailers both representing the most crowded trades both at home and abroad.

Amazon.com, Inc. (NASDAQ:AMZN) rose $2.85 (+0.37%) in premarket trading Friday. Year-to-date, AMZN has gained 13.21%, versus a 11.19% rise in the benchmark S&P 500 index during the same period.

Alibaba Group Holding Ltd (NYSE:BABA) rose $0.52 (+0.6%) in premarket trading Friday. Year-to-date, BABA has gained 7.46%.


This article is brought to you courtesy of ZeroHedge.


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