RWC Asset Advisors Exits Its Entire Li Auto Stake -- Selling $33 Million Worth of Shares

What happened

According to a Feb. 17, 2026, SEC filing, RWC Asset Advisors exited its stake in Li Auto (NASDAQ:LI), selling 1,638,544 shares during the fourth quarter. Based on the average share price for the quarter, the estimated transaction value was roughly $33 million. The quarter-end value of the position had been $41.5 million as of the prior 13F filing.

What else to know

• The fund fully liquidated its Li Auto stake, which had represented 6.8% of its assets under management in the prior quarter.
• Top holdings after the filing:
  • NYSE:SQM: $100.6 million (19.1% of AUM)
  • NYSE:VALE: $85.0 million (16.1% of AUM)
  • NYSE:EMBJ: $79.8 million (15.1% of AUM)
  • NYSE:GFI: $75.6 million (14.3% of AUM)
  • NYSE:BABA: $66.0 million (12.5% of AUM)
• As of March 19, 2026, shares of Li Auto were priced at $17.10, down 38% over the past year and underperforming the S&P 500 by 56 percentage points.

Company overview

Company snapshot

• Li Auto designs, manufactures, and sells premium smart electric vehicles, including multi-purpose vehicles (MPVs) and sport utility vehicles (SUVs).
• The company generates revenue primarily through direct sales of its electric vehicles, supported by after-sales management and technology development services.
• Its main customers are Chinese consumers seeking advanced, energy-efficient vehicles in the premium SUV and MPV segments.

What this transaction means for investors

RWC Asset Advisors didn't reduce its Li Auto position; it walked away entirely from a holding that represented roughly 6.8% of the fund's assets just one quarter earlier. That kind of decisive move will catch many investors’ attention, even if the reasons behind it aren't spelled out in the SEC filing.

Here’s what we do know. Li Auto shares had already fallen fairly dramatically in the months leading into Q4 2025 -- and the stock has continued to lag the broader market since then. Its most recent earnings report wasn’t exactly inspiring either: The company missed estimates on the top and bottom lines, with revenue declining 35% year over year, and vehicle deliveries down 31%.

The Chinese EV sector has been navigating real headwinds: intense domestic price competition, slower-than-expected consumer demand in the premium segment, and persistent uncertainty around U.S.-China trade tensions. For an international-focused fund like RWC, which currently counts Chilean lithium producer Sociedad Química y Minera de Chile (NYSE:SQM) and Brazilian iron ore giant Vale (NYSE:VALE) among its largest positions, a full exit from a struggling Chinese EV name could reflect anything from a strategic shift toward commodity exposure to a straightforward loss-of-conviction call.

Obviously, selling a position -- even a large one -- doesn't always signal a bearish view on a company's long-term prospects. Portfolio rebalancing, risk management, and redemption activity can all drive institutional sales. But a complete liquidation of a nearly 7% position, in a stock that's been struggling, carries more weight than a routine trim. Investors who still hold Li Auto -- or are considering a position -- may want to weigh this institutional vote of no-confidence before deciding whether Li’s current price represents a discount or a warning sign.

Andy Gould has no position in any of the stocks mentioned. The Motley Fool recommends Alibaba Group. The Motley Fool has a disclosure policy.