Investment in the bet placed by Michael Burry, known for his role in 'The Big Short', is bringing in massive profits for him and also granting similar wealth gains for others.
In the ever-evolving world of investment, the BÖRSE ONLINE Best of Billionaires Index serves as a valuable resource for those seeking to emulate the strategies of the world's wealthiest investors. One such investor, Michael Burry, known for his prescient bet against subprime mortgages during the 2008 financial crisis, has recently shifted his focus towards Chinese tech giants Alibaba, Baidu, and JD.com.
In the second quarter of 2025, Burry bolstered his stakes significantly. He invested approximately $28 million in call options for Alibaba, accounting for 4.90% of his portfolio, and nearly $32.6 million in call options for JD.com, representing 5.64% of his holdings. Although details about his new positions in Baidu calls are less pronounced compared to Alibaba and JD.com, he did close bearish put options on the company, indicating a shift in focus.
Prior to this, in late 2024 and early 2025, Burry had both increased shares in these companies and hedged with put options—selling bets against the stocks to manage downside risk. For instance, by the end of Q3 2024, he had bought 200,000 shares of Alibaba and 500,000 shares of JD.com but simultaneously purchased put options on a substantial number of these shares, reflecting a cautious approach.
Recent regulatory and competitive pressures in the Chinese tech sector have led Burry to believe these companies are undervalued. His buy call options signal a bet on a recovery or an improved valuation environment. This strategy offers leveraged exposure to stock price gains without the direct risks associated with full stock ownership.
Burry's portfolio adjustments align with a broader confidence in the Chinese e-commerce sector's future. Alibaba and JD.com remain dominant players with scalable models despite past volatility. Baidu, while less active in call option purchases compared to Alibaba and JD.com, still remains part of Burry's portfolio post-closing bearish positions.
As Burry continues to invest a significant portion of his liquid assets in Chinese stocks, many experts, including billionaire David Tepper, expect the rally in China to persist. The iShares MSCI China A UCITS ETF, an investment option for those interested in Chinese stocks, currently has an index P/E of just 11.9.
Stocks like Alibaba surged by 20% or more following the introduction of the Chinese government's stimulus package, earning Michael Burry millions of dollars in the process. However, it's essential to note that Wall Street analysts remain largely skeptical about these Chinese stocks, seeing little remaining upside after the rally.
Investors interested in following in Burry's footsteps should remember that past performance is not always indicative of future results. As analysts have often proven wrong in the past, it's crucial to conduct thorough research and consider all factors before making investment decisions. The BÖRSE ONLINE Best of Billionaires Index, while a valuable resource, should not be used as a direct investment option. Instead, it can serve as inspiration for those seeking to emulate the strategies of successful investors like Michael Burry.
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