Hong Kong-based hedge fund Aspex Management became Nio‘s largest institutional investor in the third quarter.
The fund founded by Hermes Li in 2018 has acquired 35 million shares of the Chinese electric vehicle maker as the stock more than doubled and institutional ownership surged following years of decline.
Aspex disclosed the position in its third-quarter regulatory filing, establishing a stake valued at approximately $215 million based on Nio‘s September 30 closing price of $7.62.
The investment represents the hedge fund’s seventh-largest holding and 5.6% of its $4.01 billion portfolio across 30 companies as of quarter-end.
The massive stake marks Aspex’s return to Nio after years of intermittent positioning.
The firm first invested in the Shanghai-based EV maker exactly five years ago with a 4 million-share purchase.
Over the subsequent two and a half years, Aspex’s holdings fluctuated between one million and ten million shares, with the fund completely exiting its position twice — in early 2022 and early 2023 — before re-entering with the 35 million-share position in the third quarter.
Institutional Ownership Rebound
The Aspex investment comes amid a sharp rebound in Nio‘s institutional shareholder base following years of erosion.
At its peak, institutional investors collectively held nearly 600 million Nio shares.
That figure plunged below 200 million in recent years as the stock declined, but has since recovered to approximately 322.7 million shares held by 473 institutions as of Tuesday, according to Nasdaq data.
The third quarter alone saw institutional holdings jump by more than 100 million shares, a 58% increase from just under 200 million shares at the end of the second quarter, Fintel data shows.
The surge coincided with Nio‘s stock more than doubling during the three-month period, rising from $3.51 on July 1 to $7.62 on September 30.
Aspex’s Background
Billionaire Hermes Li founded Aspex Management in 2018, building it into one of Asia’s largest hedge funds with a focus on public and private companies across the region.
Beyond Nio, Aspex sharply increased its stake in US-listed Chinese autonomous driving startup Pony.AI, holding 4,140,447 shares at quarter-end. Nio was the only Chinese automaker in Aspex’s portfolio as of September 30.
The hedge fund fully exited positions in both Intel Corp. and Taiwan Semiconductor Manufacturing Co., the world’s largest contract chipmaker, during the quarter.
UBS Group AG, previously Nio‘s largest institutional investor, slashed its position by 59% during the third quarter to 28.7 million shares worth approximately $177 million currently.
Jane Street Group ranks third among institutional holders with a stake worth nearly $118.5 million.
Broader Institutional Repositioning
Other major institutional investors also significantly altered their Nio positions during the third quarter.
D.E. Shaw & Co., which had sold all 8.6 million shares between April and June, re-entered with 13.8 million shares, becoming Nio‘s seventh-largest institutional investor.
London-based RWC Asset Management acquired 10.46 million shares in the third quarter, marking its return to the stock nearly five years after exiting.
The pattern of hedge funds re-entering Nio after years away suggests renewed confidence in the automaker’s prospects following product launches and improving financial performance.
Two Sigma Advisers also re-entered Nio in the third quarter after exiting in mid-2023, acquiring 2,979,800 shares valued at $22.7 million as of September 30.
The institutional positioning changes come as Nio works to boost deliveries with new models including the refreshed ES8 SUV, which garnered more than 100,000 orders and helped drive shares to a 13-month high of $8.02 in early October.
Nio‘s American depositary shares traded 1.6% lower at $5.98 in Tuesday’s premarket session.
The stock remains up substantially from mid-year levels despite the recent pullback from October highs.
