Who Is Michael Burry?
Michael James Burry is both an American investor who founded the hedge fund Scion Capital in 2000 using a small inheritance and a physician who specializes in neurology. Among investors he is best known for being one of the few who predicted the subprime mortgage crisis that lasted from 2007 to 2010. He shorted the 2007 mortgage bond market by swapping collateralized debt obligations (CDO) and made a personal profit of $100 million and $700 million for his investors.
In 2008 he shut down Scion Capital to focus on his personal investments. Then, in 2013, he incorporated Scion Asset Management, a private investment firm he still runs today based in Saratoga, Calif., which is in Silicon Valley.
Burry was portrayed by Christian Bale in the 2015 film The Big Short, which offered a fictionalized version of some key players in the subprime mortgage crisis. Director Adam McKay cowrote the Oscar-winning screenplay with Charles Randolph, which they adapted from Michael Lewis’ nonfiction book The Big Short: Inside the Doomsday Machine.
In addition to Burry’s short on the mortgage bond market, he is known for his prescient opinions on money and investing that can lead investors to healthy returns. He is sometimes called “the Big Short investor.”
Key Takeaways
- Michael Burry is an investor who profited from the subprime mortgage crisis by shorting the 2007 mortgage bond market, making $100 million for himself and $700 million for his investors.
- Burry shut down his hedge fund, Scion Capital, in 2008. In 2013 his private investment firm, Scion Asset Management, was incorporated.
- In April 2022 Burry tweeted that the Fed “has no intention of fighting inflation.”
- Burry holds an M.D. and is licensed to practice medicine in California but does not.
Personal Life and Education
Michael James Burry was born in 1971 and raised in San Jose, Calif. When he was two he lost his left eye to a rare form of cancer called retinoblastoma. He has worn a prosthetic eye ever since.
Burry earned his bachelor’s degree in economics at the University of California, Los Angeles, where he also studied premed. He then got an M.D. from Vanderbilt University School of Medicine and later began residencies at Stanford University in neurology and pathology. During his education Burry used his spare time to focus on investing. Though he left Stanford after his third year in residency in neurology at Stanford University Hospital to concentrate full time on investing, he keeps up his license with the Medical Board of California by taking continuing education courses.
Burry has a wife and two adult sons, one of whom was diagnosed with Asperger’s Syndrome as a boy, which prompted Burry to discover that he too has the condition. As portrayed in the film The Big Short, he is also known for being a huge enthusiast of heavy metal music.
$300 Million
Michael Burry’s net worth, as estimated by Celebrity News Net Worth.
What Kind of Investor Is Michael Burry?
Burry, whom author Lewis calls “obsessive,” comes up with strategies that diverge from the herd mentality, as he did when he shorted the mortgage bond market for CDOs in 2007. He considers himself a value investor. He has also been highly critical of government financial policy, especially that of the Federal Reserve.
In a 2010 New York Times op-ed called “I Saw The Crisis Coming. Why Didn’t the Fed?,” Burry wrote that “our leaders in Washington either willfully or ignorantly aided and abetted the [real estate] bubble. And even when the full extent of the financial crisis became painfully clear early in 2007, the Federal Reserve chairman [Ben S. Bernanke], the Treasury secretary [Henry M. Paulson], the president [George W. Bush] and senior members of Congress repeatedly underestimated the severity of the problem, ultimately leaving themselves with only one policy tool: the epic and unfair taxpayer-financed bailouts…. It did not have to be this way.”
On April 14, 2022, Burry tweeted, “The Fed has no intention of fighting inflation. Serial half-point hikes are getting elevation before stocks and the consumer tap out. Same with rapid-fire QT. The Fed’s all about reloading the monetary bazooka, so it can ride to the rescue & finance the fiscal put.”
Burry inaccurately predicted a recession in 2023, posting the single word “Sell” on the social media platform X (formerly known as “Twitter”) in January, but he contradicted that in March when he posted, “I was wrong to say sell.” His last 2023 post on X was in April.
Frequently Asked Questions
Why Did Michael Burry Close His Fund?
Burry founded his hedge fund Scion Capital in 2000. He shut it down in 2008 to focus on personal investments and his family.
What Does Michael Burry Own Now?
In 2013 Burry founded Scion Asset Management LLC, a private investment company that he manages today. The firm had about $94.5 million in assets under management as of December 2023, according to its SEC filings.
As of the fourth quarter of 2023, Burry’s top holdings are Alibaba Group Holding Ltd. (6.1%), JD.com Inc. (6.1%), HCA Healthcare Inc. (5.7%), Oracle Corp. (5.6%), Citigroup Inc. (5.4%), CVS Health Corp. (5.4%), NextStar Media Group (5.4%), Star Bulk Carriers (4.9%), Amazon.com. Inc. (4.8%), MGM Resorts International (4.7%), Booking Holdings Inc. (4.7%), Advance Auto Parts (4.5%), Warner Bros. Discovery Inc. (4.5%), Vital Energy Inc. (4.1%), and Block Inc. (4.1%).
What Is Michael Burry Shorting Now?
In the third quarter of 2023 Burry decided to hedge against the global semi-conductor market, which had been doing well in 2023 after economies recovered from the COVID-19 pandemic and supply chain problems were alleviated. According to U.S. News and World Report, “Burry has a history of shorting high-flying technology stocks and funds. He’s wagered against Cathie Wood’s flagship ARK Innovation ETF (ARKK) and Elon Musk’s Tesla Inc. (TSLA) in past years.”
Specifically, he shorted BlackRock Inc.’s (BLK) semiconductor fund. Unfortunately for Burry, BlackRock’s success has not abated, leaving Burry’s choice “look[ing] wobbly at the opening of 2024.”
What Was the Subprime Crisis or Meltdown?
The subprime meltdown was the sharp increase in high-risk mortgages that went into default beginning in 2007, contributing to the Great Recession, the most severe economic downturn since the Great Depression. The housing boom of the mid-2000s—combined with low interest rates at the time—prompted many lenders to offer home loans to individuals with poor credit. When the real estate bubble burst, many borrowers were unable to make payments on their subprime mortgages.
What Is ‘The Big Short’?
The Big Short is a 2015 film adaptation of author Michael Lewis’ best-selling book of the same name. The movie, cowritten and directed by Adam McKay, focuses on the lives of several American financial professionals, including Burry, who predicted and profited from the buildup and subsequent collapse of the housing bubble in 2007 and 2008.
Published in 2010, The Big Short: Inside the Doomsday Machine was a loose sequel to Lewis’ best-selling Liar’s Poker, a chronicle of his work experiences at Salomon Brothers in the 1980s. Both nonfiction works offer a deep dive into the lives, workplaces, and psychology of several Wall Street professionals and the financial world.
The Bottom Line
Burry likely will be best known for being one of the few investors who predicted the subprime mortgage crisis that lasted from 2007 to 2010. He shorted the 2007 mortgage bond market by swapping CDOs and profited mightily from it.
