In a move reminiscent of his legendary 2008 housing bet, hedge fund manager Michael Burry is betting against artificial intelligence stocks. Through Scion Asset Management, Burry disclosed put option positions with a combined notional value of roughly $1.1 billion on Palantir Technologies and Nvidia.
The actual cost to enter these trades was far smaller-approximately $9 million in premiums, mostly for long-dated contracts expiring in 2027 with strike prices far below current market levels. Analysts say this signals Burry expects a significant repricing, not a minor pullback.
Burry has questioned the return-on-invested-capital for AI infrastructure, arguing massive spending may not justify future revenues. His 2008 subprime mortgage short netted over $700 million for investors.
Recent filings show Burry expanded bearish tech bets, with shorts on semiconductor ETF SOXX, QQQ, Oracle, and Tesla. While the trades don't directly target crypto, the strong correlation between tech stocks and digital assets means any AI skepticism could ripple through crypto markets.