Michael Burry, Hedge Fund Manager, Places a $1.6 Billion Bet Against Wall Street, Comprising 90% of His Portfolio.
The famed investor known as the “Big Short” fund manager, who accurately predicted the North American mortgage crisis that spiralled into the global financial crisis, has now placed a colossal wager against the US stock market.
Michael Burry, who was brought to the big screen by Christian Bale in the movie “The Big Short,” has established short positions amounting to $1.6 billion against several of Wall Street’s key indexes. Here’s more from Lauren Almeida:
Burry, the renowned investor who foresaw the 2008 market crash, is staking $1.6 billion (£1.3 billion) on the anticipation of a second crisis occurring by the end of this year.
Michael Burry, the Wall Street trader who forecasted America’s subprime mortgage crisis in the 2000s—a pivotal trigger for a worldwide financial calamity—has bet against the S&P 500 and Nasdaq 100 stock indices, per filings submitted to the Securities and Exchange Commission, the US financial regulatory authority.
Scion Asset Management, Burry’s firm, has purchased $866 million in put options against a fund that mirrors the S&P 500, the definitive American index. These options grant investors the privilege to sell shares at a predetermined price in the future, setting the stage for potential profits if share prices decline.
In addition, the firm has secured $739 million in positions against a fund that tracks the Nasdaq 100, which is reflective of some of America’s most prominent technology companies.
Demonstrating his firm conviction, Burry is allocating over 90% of his fund’s portfolio to gamble on this anticipated downturn, as various reports have indicated.
This is not Burry’s first significant gamble; he initially gained widespread recognition through his lucrative bets against the American housing market prior to the 2008 financial crisis—a strategy that yielded hundreds of millions of dollars in profits for his investors.
Actor Christian Bale plays investor Michael Burry in “The Big Short.” Credit: Plan B Entertainment
