Michael Burry Bets Against AI 'Emperor Stocks'... "1987-style Crash Possible"

▲ Wall Street, US Stock Market, Nvidia (NVDA), Palantir (PLTR), Tesla (TSLA), Bear Market/AI Generated Image

Michael Burry maintained his short positions on major artificial intelligence (AI) stocks, warning of a potential crash similar to 1987.

According to Nasdaq on September 12 (local time), Burry maintains a bearish outlook on Nvidia (NVDA), Palantir Technologies (PLTR), and Tesla (TSLA). Micron Technology (MU), Applied Materials (AMAT), and Caterpillar (CAT) are also targets for short selling. He is also betting on a decline in the iShares Semiconductor ETF (SOXX). Burry stated, “The market may be approaching a major peak, and a crash like 1987 is possible.”

What Burry noted was the recent rapid pace of the stock market's rise. The S&P 500 has only seen three instances in the past where it rose 5% in four trading days to reach an all-time high. These instances were in April 1999, March 2000, and November 2020. Burry specifically cited semiconductor stocks and momentum investment trends as key variables that could once again lead the market.

He did not definitively conclude that the bull market would end immediately. Burry believed that the S&P 500's new all-time high could attract new investment funds. He explained that if volatility decreases, funds that adjust investment proportions based on volatility and momentum strategies could increase leverage. He judged that this trend could further push stock prices up but also intensify market overheating.

Burry is also maintaining most of his existing short positions. Some of his Nvidia put options have had their expiration extended until June 2027. While some Palantir put options were closed, the stock short position remains. Burry stated that all his major short positions, except for Nvidia, are profitable. However, he also made it clear that he would limit losses if stock prices moved distinctly against his judgment.

Burry did not recommend a short-selling strategy to individual investors. He said, “Short selling is not a strategy for everyone. I have to short sell, but most people shouldn't.” This means he has not withdrawn his bearish outlook on Nvidia, Palantir, and Tesla, even as the AI stock rally continues.

[Key Summary of the Article]

-Michael Burry maintains short positions on major AI-related stocks, including Nvidia, Palantir, and Tesla.

-Burry raised the possibility that the market is approaching a major peak and warned of a potential crash similar to 1987.

-His short positions are profitable, except for Nvidia, but Burry did not recommend short selling to individual investors.

*Disclaimer: This article is for investment reference only, and we are not responsible for any investment losses based on it. The content should be interpreted for informational purposes only.*