The hedge fund manager, who gained notoriety for betting against the market before the 2007-2008 financial crisis, has made a bet worth about $47 million in the iShare Semiconductor ETF (SOXX), an exchange-traded fund comprised of a variety of semiconductor and microchip stocks.
This is revealed in an update released by Burry’s fund Scion Asset management on Tuesday. The case has been reported by several American media.
Scion has taken a put option on 100,000 shares of SOXX. A put option is a contract that gives the buyer the right to sell the position at a specified price at a specified time. If the price of the underlying asset has fallen, Burry can sell for more than what he bought for.
The largest positions in the SOXX fund are Advanced Micro Devices, Broadcom and Nvidia. SOXX is up 30 per cent so far this year, partly as a result of the three shares being up 85 per cent, 74 per cent and 240 per cent respectively since the new year.
Profited from the stock market decline
Scion’s new position comes after the close of a successful bet on a broad US stock market decline. Throughout the third quarter, the “Big Short” investor went “Big Short” when he took a large short position in the S&P 500 and Nasdaq 100 indexes.
From the start of July to the end of September, the two indices ended down 3.7 and 3.1 per cent respectively. How much the Scion fund earned is not known, but the short positions totaled just over $1.6 billion.
Scion also has positions in individual stocks. In the update, it appears that the fund has bought back into Alibaba Group, after the share was dumped in the second quarter. Burry is also betting on the car group Stellantis, with a new position of 7.7 million dollars. At the same time, they got rid of the shares in Expedia Group.
2023-11-14 20:39:30
#Michael #Burry #bets #chip #fall
