Michael Burry, the investor known for his accurate bets against the U.S. housing market in 2008, has deregistered his hedge fund, Scion Asset Management, from the records of the U.S. Securities and Exchange Commission (SEC). The U.S. market regulator’s database listed Scion’s registration status as “cancelled” as of November 10. The deregistration would mean that the fund is no longer required to file reports with the regulator or any state, according to Reuters.
Scion’s bets, which managed $155 million in assets as of March, have long been analyzed by investors as indicators of potential impending bubbles and signs of market froth. Investment funds managing more than $100 million in capital are required to register with the SEC.
Burry is said to have written a letter to the fund’s investors, which was circulated via the social network X (formerly Twitter), in which he announced “with a heavy heart” the fund’s liquidation and the return of capital to investors by the end of the year. “My estimation of stock values is not now, nor has it been for some time, in tune with the market,” the letter reads.
A few days earlier, Burry wrote on his X profile: “On to much better things on November 25.” Burry, who appeared in the well-known book and film The Big Short, has in recent weeks intensified his criticism of tech giants, including Nvidia and Palantir Technologies, questioning the rise of cloud infrastructure and accusing major providers of using aggressive accounting to inflate profits from their massive hardware investments.
In his post on X, Burry stated that he had spent around $9.2 million on the purchase of approximately 50,000 put options on Palantir, noting that the options would allow him to sell the shares at $50 each in 2027. Put options grant the right to sell shares at a predetermined price in the future and are typically purchased to express a bearish or defensive outlook. Palantir shares were trading at $178.29 on Thursday, giving the company a market value of $422.36 billion.
Bearish Positions on Artificial Intelligence
Last month, Burry posted an image of his character from The Big Short and warned about bubbles, saying that “sometimes, the only winning move is not to play.” In his criticism of tech firms, Burry argues that as companies like Microsoft, Google, Oracle, and Meta invest billions of dollars in Nvidia chips and servers, they are also quietly extending depreciation schedules to make earnings appear smoother. To such an extent that, by his estimates, between 2026 and 2028, these accounting decisions could understate depreciation by around $176 billion, inflating reported profits across the sector.
His X profile, titled Cassandra Unchained, is seen as a nod to the Greek mythological figure cursed by Apollo to utter true prophecies that no one would believe.
The appreciation in shares of companies related to artificial intelligence has accounted for 75% of the S&P 500 index’s performance since November 2022, when OpenAI launched ChatGPT, according to a September analysis by JP Morgan Asset Management.
Scion, Burry’s firm, ended last year holding positions in American Coastal, Bruker, Canada Goose, HCA Healthcare, Magnera, Molina Healthcare, Oscar Health, and VF Corp, but the firm exited those positions earlier this year. During the quarter ending June 30, Scion Asset Management took a more optimistic stance on companies across different sectors and geographies, after previously betting against Chinese companies when President Donald Trump’s administration was considering the imposition of tariffs.
Challenges for Short Sellers
Burry, who founded Scion Asset Management in 2013, joins a group of high-profile investors navigating a market that has become increasingly hostile to bearish views in recent years, fueled by unrestrained optimism surrounding technology and strong interest from retail investors.
In this context, Hindenburg Research shut down earlier this year after a series of high-profile calls, including bets against Indian conglomerate Adani Group and U.S. electric truck maker Nikola.
Veteran short seller Jim Chanos, known for his bets against energy firm Enron months before its collapse, has also clashed with Michael Saylor’s bitcoin-focused company, Strategy. Chanos argued that Strategy’s valuation premium was unjustified—a criticism that prompted a sharp response from Saylor.
