'Big Short' investor Burry turns bearish on China in Q1
Michael Burry's Scion Asset Management has become increasingly bearish on Chinese companies in Q1, reducing its portfolio from 14 to 7 companies. Burry purchased put options on Alibaba, Baidu, JD.com, and PDD Holdings, indicating a defensive stance. This shift follows new trade policies under the Trump administration, which included significant tariffs on China. Additionally, Burry acquired put options on Nvidia and Trip.com Group, while maintaining a long position in Estee Lauder. The regulatory filing did not disclose specific details about the options purchased.
By Carolina Mandl
NEW YORK, May 15 (Reuters) - Michael Burry's Scion Asset Management ended the first quarter more bearish on Chinese companies as the Trump administration discussed new trade policies, a regulatory filing showed.
Burry, known for his prescient calls ahead of the 2008 U.S. housing market crash, slashed the number of companies in his portfolio by roughly half, to seven, while placing bets that benefit from a decline in share prices.
The U.S. investor, whose bets were chronicled in the movie "The Big Short," bought put options on Chinese companies Alibaba 9988.HK, Baidu 9888.HK, JD.com 9618.HK and PDD Holdings PDD.O in the first quarter.
Put options convey the right to sell shares at a fixed price in the future and are typically bought to express a bearish or defensive view.
Burry had ended December with those same stocks, but he had only long positions, without options.
U.S. President Donald Trump imposed tariffs on imported goods from many countries in April, but with the highest levy on China. Earlier in May, both countries agreed on a deal that will see tariffs on China fall to 30% from 145%, while China will reduce tariffs on the U.S. to 10% from 125%.
The filing also showed Burry bought put options on Nvidia NVDA.O and China's Trip.com Group 9961.HK, which are both new positions in his portfolio.
Regulatory filings do not require the disclosure of option strikes, purchase prices and expiration dates. Since the filings disclose only long positions, it was also not clear whether the positions were held outright or against other contracts.
His portfolio also included a long position in U.S. cosmetic giant Estee Lauder EL.N.
Scion ended last year with shares in American Coastal ACIC.O, Bruker BRKR.O, Canada Goose GOOS.TO, HCA Healthcare HCA.N, Magnera MAGN.N, Molina Healthcare MOH.N, Oscar Health OSCR.N and VF Corp VFC.N, but the firm ended those bets.
