Key Takeaways
- • Bridgewater's China Total Returns fund delivered a 34.2% return in 2025, capitalizing on stimulus-driven corporate buybacks and a reversal of year-start China investment concerns.
- • Tekne Capital, the $1.5 billion firm managed by Beeneet Kothari (former lieutenant to Stanley Druckenmiller), posted returns exceeding 50% through investments in DiDi Global, Kanzhun, and GDS Holdings, benefiting from valuations depressed by geopolitical headwinds.
- • The average China-focused hedge fund generated approximately 18% returns in 2025, with standout performers including Triata Capital (44% September returns; 56% through September year-to-date), George Jiang's Golden China fund (near 33%), and Epimelis Capital (run by Fei Sun, former Goldman Sachs and Hutchison Hill veteran).
- • China's technology sector and AI landscape emerged stronger than feared, with ByteDance valued between $350–$370 billion following its US TikTok majority stake sale, DeepSeek advancing AI competitiveness, and the US government permitting Nvidia H200 chip sales to Chinese companies.
- • Early 2025 fears—US protectionism, real estate weakness, TikTok ban risk, and AI development lag—proved largely overblown as Chinese government stimulus and corporate buyback programs drove equity valuations higher.
Summary
China-focused hedge funds delivered exceptional returns in 2025, rewarding managers who maintained conviction amid widespread pessimism at the year's outset. The investment backdrop appeared treacherous: a protectionist US administration had assumed office, China's property market remained fragile, ByteDance faced potential TikTok sanctions, and Western artificial intelligence capabilities appeared to have decisively outpaced Chinese competitors. Yet within twelve months, the narrative shifted dramatically.
Bridgewater, which oversees $92 billion in total assets, generated a 34.2% return in its dedicated China Total Returns fund during 2025. The performance reflected a strategic shift by Chinese policymakers toward economic stimulus and corporate capital returns. Public companies significantly accelerated share buyback programs, providing equity support that hedge fund managers capitalized on. Tekne Capital, a $1.5 billion firm helmed by Beeneet Kothari (formerly a key portfolio manager under billionaire Stanley Druckenmiller), achieved returns exceeding 50% by concentrating exposure in depressed Chinese equities including ride-hailing operator DiDi Global, recruiting platform Kanzhun, and data-center operator GDS Holdings. Kothari's thesis centered on the market's mispricing of fundamentally sound businesses under geopolitical and macro pressure.
Additional top performers underscored the sector's breadth. Hong Kong-based Triata Capital posted a 44% September return, reaching 56% cumulative performance through September. George Jiang's long-running Golden China fund achieved approximately 33% returns, while Epimelis Capital, operated by Fei Sun (a veteran of Goldman Sachs and Hutchison Hill), also delivered strong results. Industry-wide, the average China-focused hedge fund generated close to 18% in 2025, according to Hedge Fund Research, substantially outpacing global peer returns.
Technology sector dynamics also validated the contrarian positioning. ByteDance's valuation climbed to $350–$370 billion following its restructuring of US TikTok operations, positioning the firm as more valuable than many feared. China's AI startup DeepSeek demonstrated competitive parity with Western peers, while US regulators approved Nvidia H200 chip sales to Chinese entities, easing semiconductor supply constraints. These developments collectively reversed the deflation in Chinese tech valuations that had persisted through early 2025, delivering substantial gains to managers who had identified the repricing opportunity.
Bridgewater, which oversees $92 billion in total assets, generated a 34.2% return in its dedicated China Total Returns fund during 2025. The performance reflected a strategic shift by Chinese policymakers toward economic stimulus and corporate capital returns. Public companies significantly accelerated share buyback programs, providing equity support that hedge fund managers capitalized on. Tekne Capital, a $1.5 billion firm helmed by Beeneet Kothari (formerly a key portfolio manager under billionaire Stanley Druckenmiller), achieved returns exceeding 50% by concentrating exposure in depressed Chinese equities including ride-hailing operator DiDi Global, recruiting platform Kanzhun, and data-center operator GDS Holdings. Kothari's thesis centered on the market's mispricing of fundamentally sound businesses under geopolitical and macro pressure.
Additional top performers underscored the sector's breadth. Hong Kong-based Triata Capital posted a 44% September return, reaching 56% cumulative performance through September. George Jiang's long-running Golden China fund achieved approximately 33% returns, while Epimelis Capital, operated by Fei Sun (a veteran of Goldman Sachs and Hutchison Hill), also delivered strong results. Industry-wide, the average China-focused hedge fund generated close to 18% in 2025, according to Hedge Fund Research, substantially outpacing global peer returns.
Technology sector dynamics also validated the contrarian positioning. ByteDance's valuation climbed to $350–$370 billion following its restructuring of US TikTok operations, positioning the firm as more valuable than many feared. China's AI startup DeepSeek demonstrated competitive parity with Western peers, while US regulators approved Nvidia H200 chip sales to Chinese entities, easing semiconductor supply constraints. These developments collectively reversed the deflation in Chinese tech valuations that had persisted through early 2025, delivering substantial gains to managers who had identified the repricing opportunity.
Go deeper than the headline
Research every firm in this story, track the ones that matter and get the daily briefing — free for 7 days.