Latest news with #MichaelBurry
Yahoo
08-06-2025
- Business
- Yahoo
Worried about a stock market crash? The Big Short's Michael Burry was…
The UK and US stock markets are once again approaching all-time highs. Markets have truly rebounded since Trump shocked the world with his trade policy. However, this rebound concerns me. These stock markets are trading near all-time highs despite a huge increase in the average effective US tariff, despite worsening geopolitical tensions, and despite sovereign debt concerns. Personally, I'm not sure investors have truly factored in the full impact of recent tariff increases on corporate earnings. Over the past year, average effective tariff rates have risen significantly, reaching levels not seen since the late 1930s. Under the Biden Administration, the average effective tariff rate was around 2.5%-2.7%. In May, that figure had risen to almost 20%. These tariffs have introduced new costs for businesses that rely on international supply chains. However, I just don't believe we've really seen the impact of them yet. After all, 'Liberation Day' took place at the beginning of Q2, and we're still in Q2. The full earnings impact of these tariffs is expected to become more visible in the second half of 2025, as companies report on their financial results and adjust to the new cost structures. Michael Burry, best known for predicting and profiting from the 2008 subprime mortgage crisis — a story retold in The Big Short — sold nearly all positions at Scion Asset Management in the quarter ending 31 March 2025. This move, alongside concentrated bearish bets through put options — bets that a stock will go down — on major tech and Chinese stocks, seemingly reflected his conviction that the market was sinking. Burry's only notable long was Estée Lauder, suggesting a defensive stance. However, 13F filings only show holdings as of 31 March, so his actions after that date remain unknown. As we know, the market slumped in early April but has since recovered. Within this context, I'm increasing looking at defensive options. I could look at farming stocks like Pilgrim's Pride, for example, which could outperform in a downturn. However, one option closer to home is the National Grid (LSE:NG.). The company recently reported strong financial results for the fiscal year 2025, with statutory and underlying pre-tax profit up 20%. The company is also investing heavily in its infrastructure, with a capital expenditure plan of £10bn aimed at modernising the energy grid and supporting the transition to renewable energy sources. This investment is part of a broader strategy to expand its regulated asset base, which is expected to grow by around 10% annually over the next few years. It does, however, introduce additional execution risk. Net debt is already £47.5bn — very sizeable. It's also not particularly cheap on face value. The stock trades at 14 times forward earnings, which may be a little demanding when we consider debt is on par with market capitalisation. Nonetheless, the forward dividend looks strong at 4.6%. The National Grid is not a stock I'd normally watch, but given my concerns about the potential overheating of the market, it's something I'm adding to my watchlist. It may be worth considering. The post Worried about a stock market crash? The Big Short's Michael Burry was… appeared first on The Motley Fool UK. More reading 5 Stocks For Trying To Build Wealth After 50 One Top Growth Stock from the Motley Fool James Fox has no position in any of the shares mentioned. The Motley Fool UK has recommended National Grid Plc. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors. Motley Fool UK 2025 Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
06-06-2025
- Business
- Yahoo
Is The Bull Run Over For Nvidia– 'The Big Short' Investor Michael Burry Taking Up Short Positions
Investors have followed Michael Burry's trades ever since he predicted the financial crisis of 2008 and profited from it by taking up short positions. The man still known to many as "The Big Short" investor is making headlines for his bearish outlook on one of the world's biggest tech stocks. Benzinga examines why Burry has taken short positions on Nvidia (NASDAQ: NVDA). Nvidia shares have spent much of the last 18 months on a bull run powered by AI's emergence as the world's hottest investment sector. As recently as May 2023, Nvidia shares were trading in the $35 range. Then it became clear that Nvidia's graphics processors and chipsets were mission-critical components in AI development, and the company's stock was off to the races. Don't Miss: Maker of the $60,000 foldable home has 3 factory buildings, 600+ houses built, and big plans to solve housing — Invest where it hurts — and help millions heal:. Nvidia shares increased from around $40 in January 2024 to $147.16 by early November. The company's market cap grew to an astonishing $3 trillion, and CEO Jensen Huang achieved near celebrity status as his company gate-crashed the S&P 500 Magnificent Seven. That kind of explosion in share price and market cap made Nvidia one of the biggest stories of 2024, but Burry knows what goes up must come down. Barchart is reporting that Burry's Scion Asset Management has numerous put options in Nvidia. Beyond that, the water gets a little murky in terms of predicting Burry's long game. Barchart compiled the option data from Scion's March 13F filings, but those filings include multiple shorts. Scion is also betting against Alibaba (NYSE: BABA), Baidu, and (NASDAQ: TRIP). The filings only note that the combined total of Scion's shorts is $199 million. Trending: Maximize saving for your retirement and cut down on taxes: . There is no information about expiration dates or strike prices, and the filings don't disclose whether Scion has long positions on Nvidia or the other stocks it's shorting. All this makes it difficult to decipher whether Burry has completely soured on Nvidia. President Donald Trump's tariffs have rattled multiple economic sectors, especially tech and retail, where Nvidia and Alibaba operate. Like many tech companies, Nvidia is heavily dependent on Chinese components, and jitters over the tariffs saw its shares slump to the $90 range in late March. Trump is still negotiating with China, and Nvidia has rebounded to $135.50 per share. The next shoe to drop will be quarterly earnings, which Burry may be expecting to fall short of the pressing question for investors is whether Burry is simply hedging with these short bets or believes Nvidia is overpriced and due for a correction. He has a proven knack for getting out of high-performing positions before the bottom drops, and these shorts could be part of that trend. However, the fact that Burry and Scion have $199 million in shorts spread across multiple positions may indicate that Burry is guarding against the downside. With that said, Burry shorting Nvidia should give investors cause to assess their long-term positions and goals with this stock. In the meantime, keep your eyes peeled for Nvidia's earnings report and news on the tariff negotiations. Both of those will have a significant impact on Burry's next moves with Nvidia. Read Next: Here's what Americans think you need to be considered wealthy. Image: Shutterstock Up Next: Transform your trading with Benzinga Edge's one-of-a-kind market trade ideas and tools. Click now to access unique insights that can set you ahead in today's competitive market. Get the latest stock analysis from Benzinga? APPLE (AAPL): Free Stock Analysis Report TESLA (TSLA): Free Stock Analysis Report This article Is The Bull Run Over For Nvidia– 'The Big Short' Investor Michael Burry Taking Up Short Positions originally appeared on © 2025 Benzinga does not provide investment advice. All rights reserved. Sign in to access your portfolio
News.com.au
01-06-2025
- Business
- News.com.au
Famous investor's huge move sparks fears for the economy
A prominent investor and multi-millionaire has made a huge move amid growing concerns about the global economy. Michael Burry – one of the first investors to predict and profit from the subprime mortgage crisis that occurred between 2007 and 2010 – has turned sceptical on stocks, dramatically slashing the portfolio of his Scion Asset Management company. As revealed by recent SEC filings, Burry's Scion Asset Management has liquidated most of its equity holdings in a sign that the investor is bracing for a hard market crash. The company cut the size of its portfolio to just seven stocks in the first quarter, according to a regulatory filing in May. This is down from 13 stocks in the previous quarter. Shares sold by Scion include Alibaba (BABA), Baidu (BIDU), (JD), and PDD Holdings (PDD). Meanwhile, the company's position in beauty giant Estée Lauder doubled, to 200,000 shares. Burry, who was portrayed by Christian Bale in the 2015 movie The Big Shor t is well known for spotting market bubbles, and has issued a string of warnings over recent years – some of which haven't come true. Burry has also slashed shares before – raising eyebrows in 2023 when he cut most of his holdings. Later, he discovered that it wasn't the greatest move. The investor's move comes amid uncertainty on Wall Street over US President Donald Trump's trade war and the Big Beautiful Bill, which could saddle America with a staggering $4 trillion in debt over the next decade. Currently, America's national debt stands at $USD36 ($AUD56) trillion, a figure that dwarfs defence spending as a proportion of the country's GDP. What's more, US Treasuries are on track for their first monthly loss this year due to Trump's abrupt policy shifts, which have shaken the confidence of investors. Those investors include Burry and JPMorgan chief Jamie Dimon, with Dimon declaring at an economic forum on Friday that a 'crack' was about to appear in the bond market, which happens when investors no longer have confidence in the government and its ability to service its debt. He also stated that government 'mismanagement' could potentially 'kill us'. 'I just don't know if it's going to be a crisis in six months or six years, and I'm hoping that we change both the trajectory of the debt and the ability of market makers to make markets,' the JPMorgan Chase & Co. chief executive officer said Friday at the Reagan National Economic Forum. 'Unfortunately, it may be that we need that to wake us up.' Dimon had a bleak prediction for most investors. 'I'm telling you it's going to happen, and you're going to panic. I'm not going to panic. We'll be fine. We'll probably make more money,' he said. When it comes to Australia's economic future, Treasurer Jim Chalmers said in May that managing the risk from the global economic uncertainty is a priority. He said the 'spectrum of scenarios' posed by the global outlook was 'much broader' following the impact of Donald Trump's trade war. The spotlight is well and truly on the increasingly volatile US and China relationship. The Treasurer has also stated that boosting productivity will be the focus of the Albanese government's second term, while still reining in inflation.
Daily Mail
01-06-2025
- Business
- Daily Mail
Big Short investor Michael Burry liquidates entire portfolio - except for one stock
Michael Burry, the investor who famously bet against the US housing market before the 2008 crash, has once again sounded the alarm and dumped all of his stock - except one. In a dramatic move revealed by recent SEC filings, Burry's Scion Asset Management has slashed its portfolio to just seven positions. Six of them are aggressive short bets: bearish put options against some of the biggest names in tech and Chinese equities, including Nvidia, Alibaba, and Baidu. Only one company appears to have managed to retain Burry's faith: Estee Lauder, where Burry has doubled down, boosting his holdings to 200,000 shares valued at $13.2 million. While cosmetics may be an unusual choice ahead of a potential financial meltdown, it's not without logic. In times of economic distress, consumers often indulge in small luxuries even as they forego big-ticket items - a phenomenon known as the 'lipstick index.' When wallets tighten, lipsticks replace dresses; with small indulgences offer a balm for economic wounds. Under new CEO Stephane de La Faverie, Estee Lauder is trying to reassert itself in a struggling global beauty market, particularly in North America and China. Bearish has taken out aggressive short bets: bearish put options against some of the biggest names in tech and Chinese equities, including Alibaba and Baidu Only one company appears to have managed to retain Burry's faith: Estee Lauder, where Burry has doubled down, boosting his holdings to 200,000 shares valued at $13.2 million. Product launches have accelerated. Luxury price tiers have been introduced. Still, Estee's stock is down 15% year-to-date, although it did gain 2% on Friday amid broader market turmoil. 'Burry's bet suggests belief in Estee Lauder's ability to reclaim its status as a beauty powerhouse in an increasingly competitive global market,' said Angeli Gianchandani, a global brand marketing expert at New York University. Burry appears to be bracing for a hard crash when it comes to the market and there are warning signs that have not been seen since the depths of the 2008 crisis. Burry rose to fame with his bets against the US housing market before the 2008 financial 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. This also isn't the first time Burry has gutted his portfolio. In 2023, he famously dumped most of his holdings only to later admit he was wrong. Markets are also seeing a flight to alternative assets. Gold has surged 24% year-to-date, outperforming Bitcoin's 12% gain, as investors hedge against a weakening U.S. dollar down 8% this year. Bitcoin has caught a second wind as well, bolstered by adoption from both corporations and state governments. Arizona and New Hampshire have passed legislation establishing strategic Bitcoin reserves and wwo dozen more states are considering similar measures. Not everyone is convinced, however, and JPMorgan's analysts recently noted that while Bitcoin may offer high returns, gold remains the safer bet for risk-averse investors seeking protection against geopolitical risks and currency debasement. 'We are skeptical that Bitcoin and other crypto assets offer the potential to improve portfolio resilience. Despite their low correlations to traditional assets, crypto assets have historically made portfolios more fragile,' JPMorgan analysts wrote. In the bond market, yields on the 10-year Treasury note have surged to 4.54%, while 30-year bonds are touching pre-2008 crisis levels above 5%. The moves can be seen unsettling because of their cause - the fear that Washington is about to unleash a new wave of new debt. With Moody's recently downgrading America's credit rating, concerns about fiscal instability have only deepened, reinforcing investor skepticism about the sustainability of Washington's approach. House Republicans, steered by Speaker Mike Johnson and under the watchful eye of Donald Trump, muscled through the so-called 'One Big Beautiful Bill' - a sprawling package of tax cuts and spending increases that could, according to the nonpartisan Congressional Budget Office, add $3.8 trillion to the deficit over the next decade. Christian Bale portrayed Burry in the 2015 film The Big Short. Burry rose to fame with his bets against the US housing market before the 2008 financial crisis but has not always been right With yields rising, equities look increasingly vulnerable as a place to park cash. The S&P 500 has clawed back most of the losses incurred when Donald Trump introduced his tariffs back in April. Mortgage rates are at highs not seen since the Great Recession with the average contract interest rate for a 30-year fixed-rate mortgage close to 6.92%. Credit card and auto loan rates are surging. Households and businesses are feeling the squeeze. And while politicians in Washington plays games with tax breaks and entitlement cuts, real Americans are bracing for impact. Cuts to Medicaid and food stamps loom on the horizon. Healthcare for millions could be stripped away. SNAP benefits could shrink hitting low-income Americans the hardest. 'This bill is a debt bomb ticking,' warned Rep. Thomas Massie (R-Ky.). 'I'd love to stand here and tell the American people, "We can cut your taxes and increase spending and everything's going to be just fine." But I can't do that because I'm here to deliver a dose of reality. This bill dramatically increases deficits in the near term but promises our government will be fiscally responsible five years from now. Where have we heard that before? How do you bind a future Congress to these promises? This bill is a debt bomb ticking.'
Bloomberg
30-05-2025
- Business
- Bloomberg
Ackman, Druckenmiller-Tracking ETFs Are Latest Industry Gambit
In a crowded ETF market obsessed with attention-grabbing pitches, one idea keeps coming back: Track the trades of star investors and sell them to the masses. The latest entrant comes from VistaShares, which filed this week for a suite of ETFs designed to replicate the holdings of famed money managers like Bill Ackman, Stanley Druckenmiller and Michael Burry. By combing through regulatory disclosures, the firm aims to build funds that echo the moves of these high-profile investors — a fresh spin on the long-running effort to bottle hedge-fund mystique for retail buyers.
