The hedge fund manager, who gained notoriety for betting against the market before the 2007-2008 financial crisis, made a roughly $47 million bet in the iShare Semiconductor ETF (SOXX), an exchange-traded fund consisting of a diversified group of semiconductor and microchip stocks. .
This was revealed in an update issued by Burry’s Scion Asset Management fund on Tuesday. This issue was covered by many American media outlets.
Scion has taken a put option on 100,000 shares of SOXX stock. A put option is a contract that gives the buyer the right to sell a position at a specified price at a specified time. If the price of the underlying asset falls, Perry can sell for more than he bought.
The largest positions in the SOXX fund are Advanced Micro Devices, Broadcom, and Nvidia. SOXX stock is up 30 percent so far this year, in part because the three stocks are up 85 percent, 74 percent and 240 percent, respectively, since the new year.
He benefited from the stock market decline
Scion’s new position comes after closing a successful bet on a broad decline in the US stock market. Throughout the third quarter, the “Big Short” investor turned “Big Short” when he took a large short position in the S&P 500 and Nasdaq 100 indexes.
From the beginning of July until the end of September, the two indexes ended with a decline of 3.7 and 3.1 percent, respectively. It is not known how much the Scion fund earned, but short positions totaled just over $1.6 billion.
Scion also has positions in individual stocks. In the update, the fund appears to have bought back Alibaba Group, after selling shares in the second quarter. Perry is also betting on car group Stellantis with a new position of $7.7 million. At the same time, they disposed of shares in Expedia Group.
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