Michael Burry Makes Big Bet on Chinese Internet Stocks

The Big Short Investor's Latest Moves

Michael Burry, the investor who became famous for predicting the 2008 financial crisis, has made a significant bet on Chinese internet companies.

Burry's Portfolio Shift

According to a recent filing with the U.S. Securities and Exchange Commission (SEC), Burry's hedge fund, Scion Asset Management, increased its holdings in Chinese internet stocks by over $500 million in the first quarter of 2023.

This represents a major shift in Burry's portfolio, as he had previously been known for his bearish bets on the U.S. stock market.

Top Bets

Burry's top bets in the Chinese internet sector include:

• Tencent Holdings
• Alibaba Group
• Baidu

These companies are all leaders in their respective fields and have a strong track record of growth.

Reasons for the Bet

There are several reasons why Burry may have made this bet on Chinese internet stocks:

• Growth potential: The Chinese internet market is still growing rapidly, and Chinese internet companies are well-positioned to benefit from this growth.
• Valuation: Chinese internet stocks are currently trading at relatively low valuations compared to their U.S. counterparts.
• Government support: The Chinese government is supportive of the internet sector, and this is likely to continue in the future.

Risks

However, there are also some risks associated with investing in Chinese internet stocks:

• Political risk: The Chinese government has a history of intervening in the internet sector, and this could pose a risk to investors.
• Regulatory risk: The Chinese government is also in the process of implementing a number of new regulations on the internet sector, and this could also pose a risk to investors.
• Economic risk: The Chinese economy is currently slowing down, and this could impact the growth of the internet sector.

Overall, Burry's bet on Chinese internet stocks is a risky one, but it is also a potentially rewarding one.