Michael Burry was immortalized in the film “The Big Short” for calling out the impending housing crisis that nearly crippled the global economy and making a bunch of money in the process.
His name has reached legendary status, so when he makes big moves — especially big moves that bet against the market — people sit up and pay attention.
DON’T MISS: ‘Big Short’ Michael Burry admits he made a bad call
On Monday it was revealed that Burry held bearish bets against the S&P 500 and Nasdaq, according to securities filings released Monday, to the tune of over a billion dollars.
Burry and his Scion Asset Management fund bought put options (contracts giving the option to sell at a certain price) with a value of $886 million against the SPDR S&P 500 ETF Trust which tracks the S&P 500. Scion also bought put options totaling $739 million against against the Invesco QQQ Trust ETF QQQ that tracks the Nasdaq 100.
The $1.6 billion Scion spent betting against the market represents 93% of the fund’s entire portfolio.
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Scion also closed its stakes in regional banks Western Alliance (WALPL) – Get Free Report, Huntington Bank (HBAN) – Get Free Report, PacWest (PACW) – Get Free Report and First Republic during the quarter, signaling his concern with the banking sector.
This is a reversal from the bank buying spree Scion went on in the first quarter before economic stress led to the dissolution of multiple mid-sized banks.
The S&P 500 and Nasdaq have actually had strong years so far in 2023, climbing 17% and nearly 40%, respectively.
Put options increase in value when the underlying asset decreases in price.
Burry’s moves during the second quarter came while the stock market saw a strong rally, and some people are not convinced of his prescience.
“The guy had one good trade over a decade ago,” one Twitter user said.
Michael Burry is the king of all finance LARPS.
The guy had one good trade over a DECADE ago and you still have NPCs worshipping him and retweeting every time he buys puts because they saw him in a movie.
Send every equity index to fresh highs.
— BIG DICK BULL (BDB) (@BigDickBull69) August 14, 2023
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