Michael Burry’s 12 Failed Bets On Market Crashes Over The Past 8 Years

Burry’s strategy hinges on put options on the SPDR S&P 500 ETF (SPY) and Invesco QQQ Trust (QQQ), with a notional value of $886 million and $739 million, respectively. Get stock recommendations, portfolio guidance, and more from The Motley Fool’s premium services. Cost basis and return based on previous market day close. Burry, whose lucrative wager against the mid-2000s US housing bubble was immortalized in the film "The Big Short," is known for making dire predictions and betting against popular assets such as Tesla, Nvidia, Apple, and the S&P 500. The Rosenberg Research president, who in 2007 was labeled the "skunk at the picnic" and "class clown" for predicting a recession that arrived soon after, said to any investor adding risk to their portfolio, "You really need to have your head examined."

Passive Investing And Etfs Could Amplify Market Downturn

While the exact strike prices and expiration dates remain undisclosed, analysts speculate these options targeted SPY $450 and QQQ $370 strikes with expirations aligned to late 2023. The Motley Fool has no position in any of the stocks mentioned. Bram Berkowitz has no position in any of the stocks mentioned.

Long Positions Disclosed

Just as momentum was building, President Donald Trump’s tariffs unsettled markets, triggering a sharp selloff in early April. The market has shown remarkable resilience this year, pushing through multiple headwinds and remaining firmly afloat. Calling it an interest chart, the fund manager said this “has happened only twice — in the late 60s and late 90s.

• Beyond that, an additional drop toward $50,000 would not only devastate miners—many operate with tight margins that wouldn’t survive those prices—but would trigger cascading effects that could contaminate other markets.
• Since market conditions can change rapidly, we encourage you to verify information on your own and consult with a professional before making any decisions based on this content.
• And so the problem is, in the United States, I think when the market goes down, it’s not like in 2000, where there was this other bunch of stocks that were being ignored, and they’ll come up even if the Nasdaq crashes.

Bank Collapse Analogy

This isn’t a hedge or a minor contrarian position—this is a concentrated bet that reflects deep conviction about future market direction. Combined, these two positions represent about $1.1 billion in bearish bets, accounting for approximately 80 percent of Scion Capital’s entire portfolio. Burry purchased put options on one million Nvidia shares, valued at approximately $186.6 million, and put options on five million Palantir shares, worth roughly $912.1 million. The filing disclosed that Burry has taken substantial put option positions on Nvidia and Palantir Technologies, two companies at the forefront of the artificial intelligence revolution.

Who Is Michael Burry?

Scion Capital’s most recent 13F filing with the Securities and Exchange Commission revealed a stunning portfolio allocation that has caught the attention of market observers worldwide. He says AI and tech stock valuations are dangerously inflated.

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Burry advised Elon Musk to issue shares at peak prices to lock in gains, implying an imminent correction of 80% or more. He had tweeted months earlier that Tesla’s reliance on regulatory credits masked underlying weaknesses, calling its market cap—then over $500 billion—”ridiculous” and unsustainable. Burry’s fund reportedly navigated the period with selective bets, but his broad alarm proved premature, setting the tone for a string of smartytrade reviews overlooked uptrends.

‘big Short’ Michael Burry Warns Bitcoin May Repeat 2022 Collapse Pattern

• The broader implication is that market participants should carefully evaluate their exposure to AI-related investments and consider whether current valuations adequately reflect potential risks.
• Investors who own individual stocks may also want to look carefully at valuations, as Burry actually suggested.
• His warnings—rooted in leverage, speculation, and policy risks—often nailed the vulnerabilities, from inflation’s surge to crypto’s winter.
• He liquidated nearly all Scion’s positions, holding just one stock, and tweeted warnings of retail-driven losses on a country-sized scale.
• When Burry makes a significant move, especially one as concentrated as his current positioning, institutional investors and retail traders alike take notice.

For individual investors, Burry’s moves shouldn’t be interpreted as a directive to sell AI stocks or rush to buy puts immediately. The market can remain irrational longer than investors can remain solvent, as the famous saying goes, and put options have expiration dates that add timing pressure to the equation. As the founder of Scion Capital, he was one of the first investors to recognize the systemic problems in the housing market.

• The famous investor wrote that Bitcoin had dropped around 40 percent in value since the October peak and had even worse words for the possibility that the price might plunge even further.
• Investor Michael Burry believes current market risks are high.
• But Burry seems to be betting that market psychology and technical patterns can repeat regardless of macro context.
• Investors with a 10-, 20-, or 30-year investing horizon ahead of them don’t necessarily need to take any action, as history suggests that the longer one holds stocks, the more likely they are to generate solid returns.
• Burry has closed his hedge fund and taken bearish positions personally.
• Burry believes the recent drop in the largest and most popular cryptocurrency could have ripple effects across markets, particularly in gold and silver.

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In a world of endless rallies, Burry’s cautionary voice persists, waiting for the crash that feels inevitable—whenever it arrives. For retail followers who sold on his signals, the cost was steep—missed gains totaling trillions in market cap. His warnings—rooted in leverage, speculation, and policy risks—often nailed the vulnerabilities, from inflation’s surge to crypto’s winter. Following his infamous January “Sell” tweet—which he later admitted was wrong—this was a direct assault on market highs.