Dan Bin, is it time to face the challenge this time?

Dan Bin has always been a "celebrity" in China's private equity circle.

Especially in the past two years, his holdings in U.S. tech stocks, particularly as a "die-hard fan" of NVIDIA, have brought substantial returns on net worth, allowing him to continuously be the "leader" among domestic subjective private equity.

However, this time, he may face challenges.

In the past half month, with the rise of domestic AI large model company DeepSeek, many well-known investors both at home and abroad have begun to reassess the logic behind the rise of U.S. tech stocks.

At this time, the disclosed portfolio report of Dongfang Hongwan Overseas Fund (managed by Dan Bin) shows that Dan Bin's investment in U.S. stocks was close to $1 billion at the end of last year. Moreover, this includes a significant amount of "leveraged" investments.

What challenges will this bring him?

"High Stakes" in NVIDIA

Dan Bin's investment in NVIDIA can be described as a unity of knowledge and action.

According to disclosed documents: as of the end of December 2024, NVIDIA stocks ranked as the top holding in the portfolio of Dongfang Hongwan's overseas dollar fund "ORIENTAL HARBOR INVESTMENT FUND," with a corresponding market value of $189 million.

Dan Bin's latest holdings in NVIDIA amount to approximately 1.381 billion yuan.

A review reveals that the quarterly reports submitted by Dan Bin's overseas fund to the U.S. Securities and Exchange Commission (SEC) only have two records, namely the Q3 and Q4 reports of 2024, with no concrete data on previous holdings.

Slight "High Position Cashing Out"

The latest portfolio also shows that compared to the end of Q3 last year, Dan Bin has reduced his position in NVIDIA to some extent, with the concentration of holdings decreasing from 30% to nearly 20%.

In early June 2024, Dan Bin publicly stated: "Our company is fully committed (to investing in the AI field), and we are buying at the highest levels. Now, NVIDIA's position has reached 45%-50% because it has risen quite a bit. I haven't sold a single share, and if I have money, I will continue to buy."

When Dan Bin made this statement, he did not further disclose whether his holdings in NVIDIA stocks cover all domestic and foreign products.

From the above information, it can at least be seen that Dan Bin has made some "selling moves" regarding NVIDIA stocks.

Looking back: NVIDIA's market value rose from 1.2 trillion yuan to 4 trillion yuan by the end of the year in 2024, with the stock price increasing by 230% throughout the year, recording quarterly increases of approximately 40%, 35%, 15%, and 50%, supported by better-than-expected financial reports and sustained bullish sentiment.

In fact, Dan Bin's bullish stance on NVIDIA dates back to early 2023—when the ChatGPT craze first emerged—when many well-known domestic investors chased the AI concept, with Dan Bin being the "most vocal" follower of NVIDIA, frequently analyzing the investment value of this U.S. stock on social media

"Position Two" Uses Leverage

In fact, Dan Bin's "high-profile" holding of NVIDIA is hardly a "novelty."

When investors further analyze Dan Bin's dollar-denominated portfolio, they will find many heavyweight stocks from major U.S. stock indices, including well-known companies like Apple, Microsoft, Google, Amazon, and Tesla.

It is important to note that the "Position Two" in this portfolio has considerable uniqueness, backed by the "phantom of leverage."

According to disclosed documents, a stock abbreviated as FNGU ranks as the second-largest holding in the Dongfang Hongyuan Overseas Fund, with a corresponding market value of USD 112 million, accounting for 11.29% of the total holdings.

In fact, FNGU is an exchange-traded note that provides three times the leverage on technology stocks, belonging to a type of leveraged derivative.

Specifically, FNGU tracks a technology stock index (the global 10 large technology companies, abbreviated as the FANG+ Index), which includes NVIDIA, Facebook, Apple, Amazon, Google, Microsoft, Tesla, Netflix, and others.

These companies are all technology giants that can sway the ups and downs of the U.S. stock market indices.

How Big is Dan Bin's Challenge?

In other words, Dan Bin has effectively given the "Position Two" in his portfolio to a technology stock index product.

This index product "comes with" three times leverage, amplifying market gains threefold, theoretically mainly suitable for short-term traders confident in star technology stocks.

Therefore, when the FNGU held by Dan Bin starts to decline, the drop will also be magnified threefold.

If the index drops by 10%, Dan Bin's holding value for that stock will evaporate by more than 30%; if the index drops by 20% in a single day, the holding value will be halved.

In other words, Dan Bin's holding of this leveraged product is predicated on his prediction that the corresponding star stocks will surge significantly and that he can ensure he is "right."

Otherwise, the consequences could be dire.

A 180-Degree Turn?

Previously, Dan Bin had warned new investors not to use leverage.

In August 2024, he responded on social media that he does not use leverage.

At that time, some questioned his behavior of continuously using client funds to increase positions in AI star stocks, to which he responded:

"I am not using leverage; at most, this year's profits will be given back, but I will never face a margin call. I believe that after a brief plunge, we will return to a stable trajectory. I have invested my own money into the Dongfang Hongyuan fund."

However, Dan Bin's current holding behavior seems to have taken a 180-degree turn from his previous statements······

How should this be interpreted?

Risk Warning and Disclaimer

The market has risks, and investment requires caution. This article does not constitute personal investment advice and does not take into account the specific investment goals, financial situation, or needs of individual users. Users should consider whether any opinions, views, or conclusions in this article align with their specific circumstances. Investment based on this is at one's own risk