Free Republic
Browse · Search
News/Activism
Topics · Post Article

Skip to comments.

Michael Burry, of ‘Big Short’ fame, just bet $1.6 billion on a stock market crash
CNN via Yahoo Finance ^ | 08 16 2023 | Nicole Goodkind

Posted on 08/16/2023 7:50:28 PM PDT by yesthatjallen

Michael Burry, the “Big Short” investor who became famous for correctly predicting the epic collapse of the housing market in 2008, has bet more than $1.6 billion on a Wall Street crash.

Burry is making his bearish bets against the S&P 500 and Nasdaq 100, according to Security Exchange Commission filings released Monday. Burry’s fund, Scion Asset Management, bought $866 million in put options (that’s the right to sell an asset at a particular price) against a fund that tracks the S&P 500 and $739 million in put options against a fund that tracks the Nasdaq 100.

Burry is using more than 90% of his portfolio to bet on a market downturn, according to the filings.

But Burry appears to have been wavering between bullish and bearish on his stock picks this year. In January, he tweeted a cryptic message to his 1.4 million followers. “Sell,” he wrote. But by the end of March, he backtracked. “I was wrong to say sell.” he wrote.

SNIP

(Excerpt) Read more at finance.yahoo.com ...


TOPICS: News/Current Events
KEYWORDS: crash; michaelburry; sandp500; stockmarket; thebigshort
Navigation: use the links below to view more comments.
first previous 1-2021-39 last
To: yesthatjallen

In my mind, there’s a difference between a “stock market downturn” and a “crash”.
Is this yet another phony headline?


21 posted on 08/16/2023 8:53:06 PM PDT by nuconvert ( Warning: Accused of being a radical militarist. Approach with caution.)
[ Post Reply | Private Reply | To 1 | View Replies]

To: Yardstick

He might have been 2 years +/- early, and his hedge fund was down close to 30% at bottom. He lost a lot of big investors who demanded their accounts redeemed. That must have been exquisitely uncomfortable. Of course all this was happening while his compadres were making serious bank on the seemingly neverending ascent of the MBS market. I do not know if he had significant carry costs while his funds were struggling, or if he just purchased fixed-cost puts that he watched, sickeningly, as they relenetlessly eroded in value. Could have been both.


22 posted on 08/16/2023 9:02:26 PM PDT by Attention Surplus Disorder (The Democrat breadlines will be gluten-free. )
[ Post Reply | Private Reply | To 18 | View Replies]

To: Attention Surplus Disorder

Got it. Thanks for the background.


23 posted on 08/16/2023 9:04:33 PM PDT by Yardstick
[ Post Reply | Private Reply | To 22 | View Replies]

To: yesthatjallen

If the price of bread goes up solely due to inflation, then so does the price of stock. That is until you have to sell the stock to buy the bread.


24 posted on 08/16/2023 9:05:39 PM PDT by Neverlift
[ Post Reply | Private Reply | To 1 | View Replies]

To: Kenny Bania

Please share the square footage of each property so we can properly admire your ostentatiousness.


25 posted on 08/16/2023 9:28:51 PM PDT by HonkyTonkMan ( )
[ Post Reply | Private Reply | To 16 | View Replies]

To: yesthatjallen

so how long are the expiration dates of these put options? are they LEAPS and this guy is betting long term, or are they regular put options and he’s expecting some kind of short term downside in the market ... either way, the market doesn’t have to crash for him to make money, but simply go down some ...


26 posted on 08/16/2023 9:31:16 PM PDT by catnipman (In a post-covid world, ALL "science" is now political science: stolen elections have consequences)
[ Post Reply | Private Reply | To 1 | View Replies]

To: yesthatjallen

What’s the time-decay (theta) of his position?

Does he need the market to crash by September, or can he afford to wait until 2024?


27 posted on 08/16/2023 9:41:28 PM PDT by PGR88
[ Post Reply | Private Reply | To 1 | View Replies]

To: EEGator

It must be $1.6 billion on the underlying asset.

If he paid for $1.6 billion in puts he is going to be the richest man in the world if this works out.


28 posted on 08/16/2023 10:04:40 PM PDT by Reverend Wright ( Everything touched by progressives, dies !)
[ Post Reply | Private Reply | To 3 | View Replies]

To: Sooth2222
Eventually can take quite a while, though.

Yeah.

Typically, it takes longer than you can afford to stand behind your bet.

Regards,

29 posted on 08/16/2023 10:51:55 PM PDT by alexander_busek (Extraordinary claims require extraordinary evidence.)
[ Post Reply | Private Reply | To 15 | View Replies]

To: EEGator

And I’m betting the Treasury and FRBs can devalue the currency faster than the market can fall.


30 posted on 08/17/2023 2:04:39 AM PDT by Justa (If where you came from is so great then why aren't Floridians moving there?)
[ Post Reply | Private Reply | To 3 | View Replies]

To: yesthatjallen

Past performance is not indicative of future results.


31 posted on 08/17/2023 3:07:17 AM PDT by Bloodclot
[ Post Reply | Private Reply | To 1 | View Replies]

To: Kenny Bania

I hear ya.

A lot of people around these parts are going to be disappointed when the stock market DOESN’T crash or the recession/depression DOESN’T materialize.

Bill Maher caught a lot of flack when he said he was rooting for a recession so that Trump will lose the election. That is just but one reason I am not buying his new turnaround. That said, are a lot of people (primarily the Only Trumpers) who feel the same way today with Biden in office.

I am in semi retirement now and will eventually have to live off my investment earnings and SS. While there is no way in hell I would ever vote democrat, I sure as hell ain’t rooting for an economic collapse. That would be flat out stoopid. Talk about cutting off your nose to spite your face.


32 posted on 08/17/2023 3:12:22 AM PDT by Sir_Humphrey (The “only Trumpers” are just as damaging to the conservative cause as are the “never Trumpers”)
[ Post Reply | Private Reply | To 16 | View Replies]

To: yesthatjallen

The drop will happen sometime between the Jewish holidays of Rosh HaShana and Sukkot or a just a short time after Sukkot at the latest.


33 posted on 08/17/2023 4:25:26 AM PDT by Tom Tetroxide
[ Post Reply | Private Reply | To 1 | View Replies]

To: Justa

Are you betting $1.6 billion?…

I understand your point.


34 posted on 08/17/2023 4:43:36 AM PDT by EEGator
[ Post Reply | Private Reply | To 30 | View Replies]

To: Reverend Wright

I’ll see what details I can find.
If I can find any…


35 posted on 08/17/2023 4:44:27 AM PDT by EEGator
[ Post Reply | Private Reply | To 28 | View Replies]

To: HonkyTonkMan

“Please share the square footage of each property so we can properly admire your ostentatiousness.”

That was a well deserved pie to the face!


36 posted on 08/17/2023 4:52:17 AM PDT by FMBass (Que sais Je)
[ Post Reply | Private Reply | To 25 | View Replies]

To: EEGator

I’m betting all I got, just like Burry. The numbers are bit different tho.

But he won’t lose the full 1.6 since it’s just an option.


37 posted on 08/17/2023 5:36:32 AM PDT by Justa (If where you came from is so great then why aren't Floridians moving there?)
[ Post Reply | Private Reply | To 34 | View Replies]

To: Justa

Good on you. I was more being a smartass than not.
Not many have anywhere near that to manage.
I don’t get timing as I thought it would crash already.

What’s the saying,”the market can remain irrational longer than you can remain solvent.”


38 posted on 08/17/2023 6:04:08 AM PDT by EEGator
[ Post Reply | Private Reply | To 37 | View Replies]

To: yesthatjallen

Isn’t he just hedging his portfolio against a medium term market drop? Buying puts is like renting a time-out from the market while leaving your existing investments in place.


39 posted on 08/17/2023 6:10:36 AM PDT by Pearls Before Swine
[ Post Reply | Private Reply | To 1 | View Replies]


Navigation: use the links below to view more comments.
first previous 1-2021-39 last

Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.

Free Republic
Browse · Search
News/Activism
Topics · Post Article

FreeRepublic, LLC, PO BOX 9771, FRESNO, CA 93794
FreeRepublic.com is powered by software copyright 2000-2008 John Robinson