It looks like 'Big Short' investor Michael Burry nailed his bet against AI chip stocks

Michael Burry looks to beryllium successful the chips aft a timely stake against semiconductor stocks.

The investor of "The Big Short" fame said successful a June 30 station connected Substack that he'd shorted the iShares Semiconductor ETF (SOXX) astatine astir $643, and refreshed his bearish put options connected it too.

The exchange-traded money — which tracks the NYSE Semiconductor Index, a handbasket of chip stocks including Nvidia, AMD, Micron, and Intel — fell 21% complete the adjacent period to adjacent astatine $505 connected July 31. It roseate 0.6% connected Monday.

Larry McDonald, the writer of "The Bear Traps Report" newsletter and the erstwhile caput of US macro strategy astatine Société Générale, praised Burry's wager successful a Saturday station connected X.

He noted that different awesome spot index, the VanEck Semiconductor ETF (SMH), delivered by acold its worst July capacity successful 30 years. He tagged Burry on X and wrote "bravo."

Burry is champion known for his prescient bet against the mid-2000s lodging bubble, which was immortalized successful the book and movie "The Big Short." He pivoted from moving a hedge money to penning astir his individual portfolio connected Substack precocious past year.

He laid retired why he was antagonistic connected chip stocks successful his June 30 post. He noted the Philadelphia Semiconductor Index was the astir overextended it had been since 2000, based connected its premium to its 200-day moving average, and added that its price-to-sales ratio was "very high" astatine complete 16.

Burry branded the SOXX a "pure shape of overvaluation successful an index." He wrote that successful summation to shorting it, he had "rolled" aliases refreshed his puts to ones expiring successful March 2027 pinch onslaught prices successful the low-to-mid $400s, signaling he expects the scale to autumn to those levels by that date.

The contrarian investor has doubled down connected his bearish positions successful caller weeks.

He said successful a July 24 station that he'd bolstered his SOXX short astatine astir $536, adding that together pinch his puts it represented a "large position" for him.

In a July 30 post, he wrote that he'd again ramped up his short astatine astir $506, saying the bullish spot waste and acquisition has mislaid momentum and is starting to "look tired."

The investor has besides disclosed bets against individual chipmakers, including Nvidia and Micron, on pinch the broader Nasdaq 100, successful caller weeks.

Burry provides much real-time updates to his subscribers than virtually immoderate high-profile investor gives to their clients. But he still doesn't disclose each item of his trades, including dollar amounts, truthful it's unclear precisely really overmuch he made from his spot wagers past period aliases really good his portfolio performed overall.

Burry didn't reply Business Insider's questions astir his trades earlier publication.

The investor and writer, celebrated for making dire predictions astir marketplace crashes and recessions, has been 1 of the biggest skeptics of the wider AI boom.

He's warned that alleged hyperscalers for illustration Meta and Alphabet are overspending connected microchips and information centers that could go outdated successful a fewer short years.

He's besides called retired AI giants, including Nvidia and OpenAI, for signing "give-and-take" contracts with each different to support fueling the buzz astir their tech.