Ray Dalio's Bridgewater hedge fund has taken positions against several large European companies, including Airbus, Siemens and Unilever © FT montage; Bloomberg; Reuters; Getty Images

A $22bn bet against European stocks by Bridgewater, the world’s largest hedge fund, has seen it build large short positions in companies that generate the majority of their business outside the continent.

Bridgewater’s recently disclosed bets include short positions against multinational companies such as drugmaker Sanofi, which generates more revenues in the US than in Europe, and Airbus, which makes less than a third of its sales in Europe.

The hedge fund, which manages $160bn of assets, does not specialise in bottom-up fundamental analysis of companies, but instead concentrates on macroeconomic analysis and forecasting. Ray Dalio, the hedge fund’s founder, last year warned of rising populism in Europe being a threat to the integrity of the EU.

At least nine of the largest short positions that Bridgewater has taken against European stocks, including Siemens, Unilever and Airbus, generate more than half their revenue outside Europe, according to the companies’ annual reports.

A spokesman for Bridgewater did not return a call for comment about its short positions in Europe.

Over recent months Bridgewater has been disclosing growing short positions against some of Europe’s largest companies which have now risen to a total of $22bn. Many of the hedge fund’s disclosed short bets in Europe closely mirror the composition of the Euro Stoxx 50 index, suggesting that the stocks may not have been selected for reasons specific to their individual businesses and earnings.

Since the start of this year, Bridgewater offered seemingly contradictory commentary about the direction of the market. Speaking in Davos in January Mr Dalio said “Inflation isn’t a problem. Growth is good, everything is pretty good,” warning how “If you’re holding cash, you’re going to feel pretty stupid”.

Several weeks later the S&P 500 fell by 10 per cent and market volatility spiked. After this Bob Prince, co-chief investment officer at Bridgewater, said that “we don’t think this shakeout will be over in a matter of days”. Since then volatility has subsided and US equity markets have recovered a significant proportion of their losses.

Other companies being shorted by Bridgewater include Adidas, which makes just €5.7bn in western Europe out of total net sales of €19.3bn, and Moncler, the Italian-listed luxury puffa jacket company, which generates more revenues in Asia than any other region.

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