BlackRock has made Alibaba its second largest holding in the $792m Global Funds Emerging Markets fund, with a 3.21% weighting.
The $455.4m Lombard Odier Technology fund has a 6.5% weighting, making it the second largest holding after Google.
GAM Star Capital Appreciation US Equity, a $375.6m vehicle, has opted for a 2.7% weighting to make Alibaba its sixth largest holding.
Two sub-$100m funds have also made major purchases.
Vitruvius Asian Equity Portfolio, a $75.8m fund has made Alibaba the top holding with an 8.3% weighting.
One small fund, the ICBC Global Emerging Enterprises, has a 2.84% weighting to Alibaba, making it the tenth largest investment in the HK$26.7m ($3.4m) vehicle.
Alibaba’s network of platforms generated gross merchandise volume of $248bn, more than Amazon and Ebay combined, according to Morningstar.
The ecommerce company is expected to be a huge growth story for the next 10-15 years and is likely to become a core holding in many China-focused funds, particularly those with TMT sector exposure, said Yue Yao, senior equity manager at Morningstar in China.
“I expect majority of funds to think about having a stake in this company. Mutual funds with a TMT focus can not ignore it as a core holding.”
Alibaba is currently trading around $88, down from its September 19 IPO high of $99. Morningstar believes the company is worth $90 per share. “A lot believe the shares are fully valued already. We expect the price to be stable unless there is significant news.
“Given the competitive landscape of the industry, it’s in a volatile business. But Alibaba’s marketcap is so big we don’t expect it to be excessively volatile.”
