Is History Repeating? Michael Burry’s New Positions Raise Market Crash Speculations

Michael Burry, famous for his role in “The Big Short,” has reportedly taken bearish positions against the S&P 500 and Nasdaq 100 Index, according to recent securities filings. 

In recent news, his Scion Asset Management purchased put options with a notional value of $739 million against the Invesco QQQ Trust ETF and separate put options with a notional value of $886 million against the SPDR S&P 500 ETF. Put options allow selling shares at a fixed price in the future and are often used to express a pessimistic view. 

“Michael Burry just shorted the market with $1.6B”

Burry, who rose to fame for predicting the 2008 housing bubble collapse, has taken a substantial short position against the S&P 500 (tracked by SPY) and the NASDAQ-100 Index (tracked by QQQ), according to the Michael Burry Stock Tracker on social media. These positions represent around 93% of his entire portfolio and have attracted attention from crypto enthusiasts who see Bitcoin as a potential hedge in case of a market crash. 

However, some have scrutinized this announcement. The information could be outdated, coming from a June 30 report, implying that Burry might have made these trades earlier and potentially exited them by now. 

Burry to Ditch Alibaba?

As per other reports, Scion Asset Management also liquidated holdings in Chinese e-commerce firms JD.com and Alibaba Group, as well as regional banks PacWest and Western Alliance Bancorp, which were part of their earlier bets.

The firm increased its stake in RealReal Inc and added new positions in iHeartMedia, HanesBrands, Warner Bros. Discovery, and iShares MSCI Japan ETF. These moves have sparked speculation about Burry’s stance on the broader market, particularly his potential bets against the market through putting options on S&P 500 and Nasdaq 100 ETFs.

It’s important to note that these filings provide a backward-looking view of holdings and may not reflect current positions. Burry’s portfolio turnover is frequent, and these filings offer insights into institutional investors’ activities. 

While Burry’s actions are closely watched due to his historical influence, it’s crucial for investors to seek complete and accurate information before drawing conclusions.