A person makes use of an umbrella to protect against snow fall as he walks previous the Nasdaq MarketSite in Times Square, Midtown New York March 20, 2015. REUTERS/Adrees Latif
NEW YORK, Aug 14 (Reuters) – Michael Burry, the cash supervisor made famous within the e book and picture “The Big Short,” held bearish options against the large S&P 500 and Nasdaq 100 Index on the finish of the second one quarter, in step with securities fillings launched on Monday.
Burry’s Scion Asset Management bought put options with a notional price of $739 million against the preferred Invesco QQQ Trust ETF (QQQ.O) all through the quarter, and separate put options with a notional price of $886 million against the SPDR S&P 500 ETF (SPY.P).
Put options put across the precise to promote stocks at a set worth sooner or later and are generally bought to specific a bearish or defensive view.
It was once now not transparent what the fund paid to shop for the places – an quantity that may be a small fraction in their notional price – or the contracts’ provide price, for the reason that regulatory filings don’t require the disclosure of options moves, acquire costs and expiration dates.
Since the filings expose most effective lengthy positions it was once additionally now not transparent whether or not the places have been held outright or as a part of a bigger industry involving different contracts that would possibly were offered quick.
Burry rose to repute together with his bets against the U.S. housing marketplace ahead of the 2008 monetary disaster. Michael Lewis’ nonfiction e book “The Big Short” was once launched in 2010 and the film model got here out in 2015.
The S&P 500 (.SPX) is up more or less 17% for the 12 months thus far whilst the Nasdaq 100 (.IXIC) is up just about 39% over the similar duration. Outsized good points in a handful of megacap corporations equivalent to Nvidia (NVDA.O) and Meta Platforms (META.O) have fueled a lot of the 12 months’s rally.
The submitting additionally confirmed that the fund liquidated its stakes in Chinese e-commerce corporate JD.com (9618.HK) and Alibaba Group Holdings (9988.HK), in addition to regional banks together with PacWest (PACW.O) and Western Alliance Bancorp (WAL.N) that it had wager on within the first quarter.
The company famous it had offered its 150,000 stocks of First Republic Bank (FRCB.PK) as smartly, however didn’t point out whether or not that got here ahead of the corporate’s May 1 cave in.
Among its lengthy positions, the fund greater than doubled its stake in on-line luxurious items marketplace RealReal Inc (REAL.O), which is up just about 100% for the 12 months thus far, and added new stakes in iHeartMedia (IHRT.O), HanesBrands (HBI.N), and Warner Bros. Discovery (WBD.O), amongst others, the submitting confirmed.
Shares of iHeartMedia and HanesBrands are each and every down 16% or extra for the 12 months thus far, whilst stocks of Warner Brothers Discovery are up just about 43%.
The company additionally added 10,000 stocks of the iShares MSCI Japan ETF, which is up 13.5% for the 12 months thus far.
Scion Asset Management didn’t reply to a request for remark. Its positions have been reported in quarterly filings referred to as 13-fs, which display its holdings on the finish of the newest quarter and won’t mirror present positions. While backward- having a look, those filings are one of the vital few ways in which traders can see the positions of institutional traders equivalent to hedge price range.
Burry, who ceaselessly turns over his portfolio, drew huge consideration closing August when he dumped all of his lengthy positions and bought a stake in jail corporate Geo Group Inc (GEO.N). He now not owns stocks of the corporate.
Reporting by way of David Randall and Saqib Iqbal Ahmed in New York
Editing by way of Ira Iosebashvili and Matthew Lewis
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