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Michael Burry shorts Major index in sizable bets

thestreet.com

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Re: Michael Burry shorts Major index in sizable bets

#11

Post by unforeseen9991 »

ilaksh wrote: post #4
guywithabowtie wrote: post #2

Burry and his Scion Asset Management fund bought put options (contracts giving the option to sell at a certain price) with a value of $886 million against the SPDR S&P 500 ETF Trust which tracks the S&P 500. Scion also bought put options totaling $739 million against against the Invesco QQQ Trust ETF QQQ that tracks the Nasdaq 100. The $1.6 billion Scion spent betting against the market represents 93% of the fund's e…

How often does the Nasdaq go up 40% and then stay up? I don't really know anything about the stock market, but do you really need to be a maverick to guess that it might go down again?

The problem isn't knowing it might go down, it's knowing when it might go down, and how far.

Re: Michael Burry shorts Major index in sizable bets

#12

Post by unforeseen9991 »

lbotos wrote: post #7

https://whalewisdom.com/filer/scion-asset-management-llc#tab... I'm not an stock options hedge fund trading expert, does he not have to report the expiry date? These have an expiry date right? Or is it some type that doesn't expire?

All options expire, theta is intrinsic to the pricing model

Re: Michael Burry shorts Major index in sizable bets

#13

Post by rajataghi »

lbotos wrote: post #7

https://whalewisdom.com/filer/scion-asset-management-llc#tab... I'm not an stock options hedge fund trading expert, does he not have to report the expiry date? These have an expiry date right? Or is it some type that doesn't expire?

From what I know, it is not required to report the expiry date

Re: Michael Burry shorts Major index in sizable bets

#15

Post by fullstackchris »

ilaksh wrote: post #4
guywithabowtie wrote: post #2

Burry and his Scion Asset Management fund bought put options (contracts giving the option to sell at a certain price) with a value of $886 million against the SPDR S&P 500 ETF Trust which tracks the S&P 500. Scion also bought put options totaling $739 million against against the Invesco QQQ Trust ETF QQQ that tracks the Nasdaq 100. The $1.6 billion Scion spent betting against the market represents 93% of the fund's e…

How often does the Nasdaq go up 40% and then stay up? I don't really know anything about the stock market, but do you really need to be a maverick to guess that it might go down again?

that's what everyone said in 99 when nasdaq basically doubled in a year... then continued to more than double the year after that! a lot of guys blew up being too early trying to guess when the selloff would finally happen...

they're called bulls for a reason - they're not the brightest, but you gotta be sure to either join 'em or get the heck out of the way while they're in control!

Re: Michael Burry shorts Major index in sizable bets

#16

Post by H8crilA »

_blz2 wrote: post #10

That 723M$ figure for nasdaq is not the worth of the put options themselves, rather the value of the underlying shares that the contracts represent. He likely has 20K put options each for $SPY and $QQQ. No one is going to bet 93% of a portfolio is index puts. They're likely hedges worth tens of millions, not 1.5B$ in put options.

This may also be a spread (bullish or bearish) - since short options are not disclosed we will not know from a 13-F.

Re: Michael Burry shorts Major index in sizable bets

#17

Post by sakopov »

If the market ends up crashing, I think we'd have our 3rd crash in 3 years, which is a little crazy. Also large caps like $META trading like a penny stock where it does it a 3x in 5 months while small and mid-caps are still down since the 2022 crash. It feels weird.

Re: Michael Burry shorts Major index in sizable bets

#18

Post by andromeduck »

fullstackchris wrote: post #15
ilaksh wrote: post #4

Earlier quoted context omitted.

How often does the Nasdaq go up 40% and then stay up? I don't really know anything about the stock market, but do you really need to be a maverick to guess that it might go down again?

that's what everyone said in 99 when nasdaq basically doubled in a year... then continued to more than double the year after that! a lot of guys blew up being too early trying to guess when the selloff would finally happen... they're called bulls for a reason - they're not the brightest, but you gotta be sure to either join 'em or get the heck out of the way while they're in control!

But how much higher can the market really go with interest rates like this?

Re: Michael Burry shorts Major index in sizable bets

#19

Post by DontchaKnowit »

sakopov wrote: post #17

If the market ends up crashing, I think we'd have our 3rd crash in 3 years, which is a little crazy. Also large caps like $META trading like a penny stock where it does it a 3x in 5 months while small and mid-caps are still down since the 2022 crash. It feels weird.

I would argue the last 3 crashes werent.

Equities are wildly divorced from real value and have not had any major broad-based corrections for quite a while in my estimation. Like since before 2019.

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