Michael Burry Short
Michael Burry just bought $890M of SPY puts and $740M of QQQ puts, totaling $1.6B
Is he finally right this time?
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Depends on tenor I guess. Opening yourself up to that kind of price risk is pretty fucking stupid imo but I don't have a billion dollars of capital to throw around so what do I know
Edit: pretty sure its 1.6 bil of notional value, actual premiums paid are much lower.
Everyone knows money makes you right!
Right?
Honestly though why split between QQQ and SPY? Just go short QQQ if you feel that strongly.
Also honest take: this is a dumb plan. Theta decay is going to murder him.
Theta decay is obviously the most pressing issue, but he must've gotten murdered on those options spreads, too. It's difficult to move $1B+ into spy SHARES, let alone options which have, what, >2% of the daily volume? Especially if they were very far out of the money, that's a thin market to be moving that kind of money and expect to optimize alpha.
IMO would have been way better to just short spy or even buy a leveraged short with that kind of money.
1.6B is the nominal value. The amount he paid for the options was likely in the tens of millions. But still, the theta is going to hurt him, depending on how far out of an expiration he bought.
He’s predicted 100 of the last 3 crashes. Idk man
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