Michael Burry predicted the financial crisis in 2007 – now he bets almost 300 million against star manager

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Michael Burry, who was made famous in the film “The Big Short”, bets large sums against star manager Cathie Wood and her fund Ark Innovation Etf.

The investor puts hundreds of millions on the table in the belief that the downturn will soon be around the corner.

According to a document published by the US authorities on Monday, Burry has so-called put options on 235,500 shares in the fund, writes Bloomberg. The bet has a value of almost 31 million dollars, or 274 million Norwegian kroner, at today’s exchange rate.

A put option is a contract that gives the buyer a right, but not an obligation, to sell a position at a certain price at a certain time. If the price of the underlying asset falls, then the buyer – in this case Burry – will be able to sell it for more than what he is buying it for.

Another well-known way to bet on a stock is to “short”.

With the put options, the celebrity investor is now betting that Woods’ fund will fall in value, a bit like he bet that the US real estate market would collapse in 2007. And if you caught the news then, or have seen The Big Short in In retrospect, it is known that Burry was finally right.

Have lost faith

The flagship among Woods’ funds is precisely Ark Innovation Etf, which last year rose by 152 percent. It was the year’s best for listed funds on Wall Street.

Investors have poured into Woods fund with billions of dollars after the good results, which is due to the rise in the technology sector she specializes in. But enthusiasm has waned as several market participants have warned of bubble trends and the risk of higher inflation.