The man who famously made a fortune by predicting the financial crash in 2008 now appears betting on a stock market crash this year.
Michael Burry is thought to have made made about $100million in 2008 by correctly predicting the collapse in the American housing market which set-off a chain reaction in the global economy.
Now, against the sunny backdrop of an apparently rallying stock market, he has bet $1.6 billion on another Wall Street crash by the end of this year, according to The Times.
The bet, against the S&P 500 and Nasdaq 100 stock indices, emerged in new filings with the Securities and Exchange Commission, the American financial regulator.
They showed that Burry’s firm, Scion Asset Management, bought $866 million in put options — the right to sell an asset at a fixed price in the future — against a fund that tracks the S&P 500.
The fund also bought $739 million in put options against a fund that tracks the Nasdaq 100. Burry is using more than 90 per cent of his fund’s portfolio to bet on a downturn, according to the filings.
Burry rose to fame with his bets against the US housing market before the 2008 crisis. Michael Lewis' nonfiction book 'The Big Short' was released in 2010 and the movie version came out in 2015.
He also profited in the early 2000s by shorting high-flying tech stocks during the peak of the Dot Com bubble.
However, his bets have sometime appeared to misfire. In late 2020, he initiated short positions against Tesla stock, but later said it was just 'a trade' and he'd exited the position after Tesla's stock continued to soar.