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Michael Burry’s $1.6 billion bet against stock market is backfiring

Michael Burry's $1.6 billion bet against stock market is backfiring

In a dramatic return to the financial spotlight, legendary investor Michael Burry, famed for his eerily accurate prediction of the 2008 market crash, seized headlines once more in August. 

On August 14, SEC filings unveiled his bold move to short the US stock market, with a purchase of 40,000 put options contracts tied to SPDR S&P 500 ETF Trust (SPY) and Invesco QQQ Trust (QQQ) funds, boasting a substantial notional value of $1.6 billion. 

Burry’s latest maneuver has sent shockwaves through the financial world, igniting debates and speculations about the future of the market.

How is Burry’s ‘Big Short’ performing so far?

In contrast to 15 years ago, Michael Burry’s latest ‘Big Short’ has yet to confirm whether the investor’s prediction abilities remain as potent as they once were.

Assuming he is still holding the options contracts, Burry is down around 42% on his $1.6 billion short, according to calculations made by an trader known as Gurgavin. However, the figure is somewhat lower than the 50% reported earlier this month

“Michael Burry is now only down 42% on his “$1.6 billion” S&P 500 and Nasdaq short if he is still holding it.”

– Gurgavin said.

Burry’s short was revealed in mid-August when filings showed that the positions captured over 90% of his entire portfolio. However, it is important to reiterate that it remains unknown whether Burry still holds these shorts, as no new regulatory filings have been released since then. 

Other Burry’s stock holdings

Apart from the two shorts, other stocks that Burry owns include Expedia Group (NASDAQ: EXPE), Charter Communications (NASDAQ: CHTR), Generac Holdings (NYSE: GNRC), and Cigna Corp., (NYSE: CI), among others. 

But the investor’s top 8 holdings, excluding S&P 500 and Nasdaq options, account for less than 1% of his current portfolio, with a nominal value of over $60,000, per August filings. 

Nevertheless, the bulk of these stocks delivered positive returns this year, returning between 20% and 30% year-to-date. 

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Disclaimer: The content on this site should not be considered investment advice. Investing is speculative. When investing, your capital is at risk.

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