Written by David Randall and Saqib Iqbal Ahmed
NEW YORK (Reuters) – Michael Perry, the money manager made famous in the book and movie “The Big Short,” held bearish options against the broad S&P 500 and the Nasdaq 100 at the end of the second quarter, according to a filling of issued securities. on monday.
Burry’s Scion Asset Management purchased put options with a notional value of $739 million against the popular Invesco QQQ Trust ETF during the quarter, and separately put options with a face value of $886 million against the SPDR S&P 500 ETF.
Put options convey the right to sell a stock at a fixed price in the future and are usually bought to express a bearish or defensive view.
Berry rose to fame with his bets on the US housing market prior to the 2008 financial crisis. Michael Lewis’ nonfiction book “The Big Short” was released in 2010 and the movie version was released in 2015.
It wasn’t clear how Barry’s recent options bets had fared, given that regulatory filings don’t require disclosure of options strikes, purchase prices and expiration dates. Since the deposits only reveal long positions, it was also not clear whether the puts were held outright or as part of a larger trade involving other contracts that may have been shorted.
The S&P 500 is up about 17% for the year so far while the Nasdaq 100 is up about 39% over the same period. Huge gains in a handful of corporate behemoths like Nvidia and Meta Platforms fueled much of the year’s rally.
The filing also showed the fund liquidated stakes in Chinese e-commerce company JD.com and Alibaba Group Holdings, as well as regional banks including PacWest and Western Alliance Bancorp that it had bet on in the first quarter.
The company indicated that it had also sold 150,000 shares in First Republic Bank, but did not indicate whether this happened before the collapse of the company on May 1.
Among its long positions, the fund more than doubled its share in online luxury goods marketplace RealReal Inc, which is up nearly 100% for the year so far, and added new stakes in iHeartMedia, HanesBrands, Warner Bros. Discovery and others, show deposit.
Shares of iHeartMedia and HanesBrands are down 16% or more for the year so far, while shares of Warner Brothers Discovery are up nearly 43%.
Scion Asset Management did not respond to a request for comment. Its positions are reported in quarterly filings known as 13-fs, which show its holdings at the end of the most recent quarter and may not reflect current positions. While these filings are lagging behind, they are one of the few ways investors can see the positions of institutional investors such as hedge funds.
Perry, who often hands over his wallet, came to wide attention last August when he gave up all of his longtime positions and bought a stake in prison company Geo Group Inc. He no longer owns shares in the company.
(Reporting by David Randall and Saqib Iqbal Ahmed in New York; Editing by Ira Usbashvili and Matthew Lewis)