Michael Burry, the legendary investor who famously predicted the 2008 financial crisis, has once again captured the attention of Wall Street with his latest portfolio moves. The hedge fund manager’s Scion Asset Management recently disclosed significant bearish bets against two of the market’s hottest technology stocks, reigniting debate about potential overvaluation in the AI sector.
Known for his contrarian investment style and uncanny ability to spot market bubbles, Burry’s recent actions have sent ripples through the investment community. His strategic positioning offers valuable insights for investors seeking to understand current market dynamics.
Burry’s bold bearish bets on tech giants
In a dramatic portfolio reshuffling revealed in Scion Asset Management’s Q3 2025 13F filing, Michael Burry initiated substantial put option positions against Nvidia and Palantir. These bearish wagers represent a significant strategic shift, as Scion held no positions in either company during the previous quarter.
The timing of these bets is particularly noteworthy. Nvidia has surged approximately 54% year-to-date, whilst Palantir has skyrocketed an impressive 174%. Despite their stellar performance, Burry appears convinced these gains may be unsustainable.
The bubble warning on social media
Breaking a prolonged silence on X (formerly Twitter), Burry posted a cryptic message that many interpreted as a market warning: “Sometimes, we see bubbles. Sometimes, there is something to do about it. Sometimes, the only winning move is not to play.” This statement, reminiscent of his pre-2008 warnings, has fuelled speculation about his market outlook.
Scion’s portfolio transformation
Beyond the high-profile short positions, Michael Burry’s fund has undergone considerable restructuring. Scion reduced its total holdings from 15 positions at the end of June to just 8 by September’s close, suggesting a more concentrated and selective investment approach.
The fund completely exited all option positions from the previous quarter, including stakes in Lululemon, Meta, ASML, and Alibaba. However, Burry demonstrated continued confidence in Lululemon by doubling his stock holdings to 100,000 shares, converting from options to direct equity ownership.
New bullish positions emerge
Whilst betting against technology darlings, Burry simultaneously established bullish call positions in more traditional sectors. Scion added options in Halliburton, the oil services giant, and Pfizer, the pharmaceutical heavyweight. These moves suggest a rotation away from high-growth tech towards value and cyclical plays.
The fund also opened new positions in SLM Corporation and Molina Healthcare, further diversifying beyond the technology sector that has dominated market gains in recent years.
Understanding Burry’s investment philosophy
Michael Burry’s investment approach centres on identifying mispriced assets through rigorous fundamental analysis. His success in predicting the subprime mortgage crisis, immortalised in the book and film “The Big Short,” established his reputation as a visionary contrarian investor.
His current positioning reflects a belief that certain segments of the market, particularly AI-related stocks, may have become detached from underlying fundamentals. With Scion managing approximately $155 million as of March, Burry’s concentrated positions carry significant weight relative to his fund size.
Implications for retail investors
Whilst Michael Burry’s track record commands respect, investors should approach his moves with balanced consideration. His bearish bets against Nvidia and Palantir don’t necessarily signal imminent collapse, but rather highlight potential valuation concerns worth monitoring.
The dramatic year-to-date gains in these technology stocks have created elevated expectations. Whether Burry’s cautious stance proves prescient remains to be seen, but his willingness to position against market momentum demonstrates the conviction behind his analysis.
For those following Burry’s investment strategy, the key takeaway involves maintaining disciplined valuation frameworks and avoiding the temptation to chase momentum without regard for fundamental metrics. His portfolio adjustments serve as a reminder that even in bull markets, selective positioning and risk management remain essential.
Sources
- Business Insider – Big Short Michael Burry bubble warning
- Quiver Quantitative – Michael Burry’s Scion Asset Management bets against Nvidia and Palantir
