Cassandra
Michael Burry shut down Scion Asset Management, leaving Wall Street blind to his signature bearish bets. With markets choppy, analysts turned to the week’s real litmus test for the AI rally: Nvidia’s Q3 earnings.
Goodbye Cassandra.
Last week, Michael Burry unregistered his hedge fund, Scion Asset Management, liquidating funds to return investors’ capital.
‘My estimation of value in securities … is not now, and has not been for some time, in sync with the markets’, he said in a final letter to investors.
Most people know Burry as the guy that made US$100M personally from ‘The Big Short’ – his famous bet against the U.S. housing market in 2008. But he started building his positions as early as 2005, enduring years of ridicule and paper losses.
When the crash finally struck, it vindicated the loneliest man in finance and earned him the nickname ‘Cassandra’ from Warren Buffett – a nod to the Trojan princess who could see the future, but was cursed so no one believed her.
Was Burry’s exit a warning in disguise? On Monday, markets shuddered, driven by a tech sell-off. The Nasdaq fell roughly 5% from its record highs, and even Nvidia wasn’t spared despite CEO Jensen Huang dropping major news at the GTC conference.
Nvidia ($NVDA) expects US$500B in orders for its Blackwell and Rubin GPUs through 2026. It also secured a partnership with the U.S. Department of Energy to build the department's largest AI supercomputer. That kind of firepower had analysts betting on blowout earnings.
Whether or not billionaire investor and Palantir ($PLTR) co-founder Peter Thiel is among the bullish crowd, he chose to exit his entire Nvidia stake last quarter. His hedge fund Thiel Macro sold 537,742 $NVDA shares in Q3. Its U.S. equity holdings are down from US$212M to US$74M, parked in Tesla ($TSLA), Microsoft ($MSFT) and Apple ($AAPL).
It’s easy to spin a tale of doom – but some of these moves might just be smart diversification. After all, 13F filings are backward-looking snapshots. Berkshire Hathaway’s ($BRK.B) most recent 13F offers a different tune entirely: optimism. The firm added a meaningful position in Alphabet ($GOOGL), signalling continued faith in the long-term AI story.
So as Burry bows out, maybe he’s not exiting stage left, but letting the markets take the spotlight, foretold or not.
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