‘Big Short’ investor Michael Burry ramps up his bet against Tesla
Michael Burry against a promotional backdrop for the movie
Michael Burry.

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  • Michael Burry raised his bet against Tesla and revealed a new wager against Cathie Wood’s Ark.
  • The “Big Short” investor disclosed puts on about 1.1 million Tesla shares, up from 800,000.
  • Burry’s Scion Asset Management also bought puts on 235,500 shares of Wood’s Ark Innovation ETF.
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Michael Burry has increased his wager against Elon Musk and placed a new bet against Cathie Wood.

Burry’s Scion Asset Management held bearish put options on nearly 1.1 million shares of Tesla worth $731 million at the end of June, an increase from its puts on 800,000 shares three months earlier, regulatory filings showed.

The investor has repeatedly accused Musk and his electric-vehicle company of overpromising and underdelivering. He’s also said that Tesla’s valuation isn’t sustainable and that its stock will collapse. However, Tesla shares are up more than sevenfold since the start of 2020.

Scion also revealed puts on 235,500 shares of Ark Innovation ETF as of June 30. Wood’s flagship exchange-traded fund, which has more than doubled in value since the start of 2020, invests in growth stocks including Zoom, Coinbase, and Shopify – and counts Tesla as its largest holding.

Scion’s puts give it the right to sell Tesla or Ark shares at specified “strike prices” before certain expiration dates. If the companies’ stock prices fall below the relevant strike prices before the options expire, the fund can sell the shares for a profit.

In a tweet in February that has since been deleted, Burry said Wood’s promises of disruptive growth and transformative technologies wouldn’t be realized. “Shades of Gary Pilgrim and PBHG Growth from the 1990s, or Gerald Tsai and the Manhattan Fund in the 1960s,” he tweeted.

Ark “is defining an era,” Burry continued. “If you know your history, there is a pattern here that can help you. If you don’t, you’re doomed to repeat it.”

Scion made several other changes to its portfolio last quarter. It snapped up Discovery stock and bought bullish call options on Walmart, Cardinal Health, and McKesson. On the other hand, it sold its stakes in Occidental Petroleum, Meredith, and Zymeworks.

Burry is best known for his massive bet against the US housing bubble in the mid-2000s, immortalized in Michael Lewis’ book “The Big Short.” He also helped pave the way for the GameStop buying frenzy earlier this year by investing in the video-games retailer and pressuring its directors to make changes in 2019.

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