Who is Micheal J Burry and Why everyone talks about him Today?
Today on most social media pages everyone talks about this news:
Michael Burry just shorted the market with $1.6B
Bought $890M of
SPY
Puts
Bought $740M of
QQQ
Puts
This now makes up 93% of his entire portfolio
To me, Michael J Burry is a True Living Legend!
Michael J. Burry is an American investor, hedge fund manager, and physician. He is best known for being among the first investors to predict and profit from the subprime mortgage crisis that occurred between 2007 and 2010.
In 2000, Burry founded the hedge fund Scion Capital. Scion Capital was a very successful hedge fund, and Burry made a lot of money for his investors. However, Scion Capital closed in 2008 after the subprime mortgage crisis.
Michael Burry made a personal profit of $100 million and more than $700 million for his investors during the subprime mortgage crisis. This represents a profit of over 489% for Scion Capital, Burry's hedge fund, between its inception in 2000 and its closure in 2008.
Burry's profit was the result of his bet against the subprime mortgage market. He believed that the market was overvalued and that the housing bubble would eventually burst. He shorted mortgage-backed securities (MBS), which are investments that are backed by pools of mortgages. When the housing bubble burst in 2007, the value of MBS plummeted and Burry's bet paid off handsomely.
Burry's bet against the subprime mortgage market was a very risky one. Many investors thought he was crazy, and he was even sued by some of his own investors. However, Burry's bet turned out to be correct, and he made a lot of money for himself and his investors.
Burry's story is a reminder that it is possible to make a lot of money in the stock market by being a contrarian. He was willing to go against the crowd and bet against the subprime mortgage market, even though most investors thought he was wrong. His bet paid off, and he made a lot of money.
From a Statistical point of view, there are lots of similarities between now and November 2021,
Here are some other famous hedge funds that made money from the subprime mortgage crisis in 2007:
John Paulson's Paulson & Co. made a profit of $20 billion during the crisis. Paulson was one of the first investors to bet against the subprime mortgage market, and he made a lot of money when the housing bubble burst.
David Einhorn's Greenlight Capital made a profit of $2 billion during the crisis. Einhorn was also a contrarian investor, and he bet against the subprime mortgage market.
Seth Klarman's Baupost Group made a profit of $1 billion during the crisis. Klarman is a value investor, and he saw the subprime mortgage market as being overvalued.
George Soros is another famous hedge fund manager who made money from the subprime mortgage crisis. Soros's Quantum Fund made a profit of $1.7 billion during the crisis. Soros was one of the first investors to warn about the dangers of the subprime mortgage market, and he bet against the market.
The NAAIM Exposure Index is a measure of the average exposure to US equity markets reported by members of the National Association of Active Investment Managers (NAAIM). The index is released weekly on Thursdays. Each week, NAAIM members report their exposure on the stock market using a scale of 1 to 5, with 1 representing 100% cash and 5 representing 100% invested in stocks.
The NAAIM Exposure Index is a contrarian indicator. This means that it tends to move in the opposite direction of the stock market. When the stock market is rising, the NAAIM Exposure Index tends to fall, and when the stock market is falling, the NAAIM Exposure Index tends to rise.
This is because the NAAIM Exposure Index is based on the sentiment of active investment managers. When active investment managers are bullish on the stock market, they tend to increase their exposure to stocks. This drives up the NAAIM Exposure Index. However, when active investment managers are bearish on the stock market, they tend to reduce their exposure to stocks. This drives down the NAAIM Exposure Index.
The NAAIM Exposure Index can be used as a tool to identify potential turning points in the stock market. When the NAAIM Exposure Index is high, it suggests that active investment managers are bullish on the stock market and that a correction may be coming. However, when the NAAIM Exposure Index is low, it suggests that active investment managers are bearish on the stock market and that a rally may be coming.
The NAAIM Exposure Index has been on a downward trend for the past 3 years. In August 2020, the index was at 75.93, which is considered to be a neutral level. However, the index has since fallen to 65.49 in August 2023, which is considered to be a bearish level.
Conclusion:
It is highly likely that Micheal J Burry is not Alone!
Today on most social media pages everyone talks about this news:
Michael Burry just shorted the market with $1.6B
Bought $890M of
SPY
Puts Bought $740M of
QQQ
Puts This now makes up 93% of his entire portfolio
To me, Michael J Burry is a True Living Legend!
Michael J. Burry is an American investor, hedge fund manager, and physician. He is best known for being among the first investors to predict and profit from the subprime mortgage crisis that occurred between 2007 and 2010.
In 2000, Burry founded the hedge fund Scion Capital. Scion Capital was a very successful hedge fund, and Burry made a lot of money for his investors. However, Scion Capital closed in 2008 after the subprime mortgage crisis.
Michael Burry made a personal profit of $100 million and more than $700 million for his investors during the subprime mortgage crisis. This represents a profit of over 489% for Scion Capital, Burry's hedge fund, between its inception in 2000 and its closure in 2008.
Burry's profit was the result of his bet against the subprime mortgage market. He believed that the market was overvalued and that the housing bubble would eventually burst. He shorted mortgage-backed securities (MBS), which are investments that are backed by pools of mortgages. When the housing bubble burst in 2007, the value of MBS plummeted and Burry's bet paid off handsomely.
Burry's bet against the subprime mortgage market was a very risky one. Many investors thought he was crazy, and he was even sued by some of his own investors. However, Burry's bet turned out to be correct, and he made a lot of money for himself and his investors.
Burry's story is a reminder that it is possible to make a lot of money in the stock market by being a contrarian. He was willing to go against the crowd and bet against the subprime mortgage market, even though most investors thought he was wrong. His bet paid off, and he made a lot of money.
From a Statistical point of view, there are lots of similarities between now and November 2021,
John Paulson's Paulson & Co. made a profit of $20 billion during the crisis. Paulson was one of the first investors to bet against the subprime mortgage market, and he made a lot of money when the housing bubble burst.
David Einhorn's Greenlight Capital made a profit of $2 billion during the crisis. Einhorn was also a contrarian investor, and he bet against the subprime mortgage market.
Seth Klarman's Baupost Group made a profit of $1 billion during the crisis. Klarman is a value investor, and he saw the subprime mortgage market as being overvalued.
George Soros is another famous hedge fund manager who made money from the subprime mortgage crisis. Soros's Quantum Fund made a profit of $1.7 billion during the crisis. Soros was one of the first investors to warn about the dangers of the subprime mortgage market, and he bet against the market.
The NAAIM Exposure Index is a measure of the average exposure to US equity markets reported by members of the National Association of Active Investment Managers (NAAIM). The index is released weekly on Thursdays. Each week, NAAIM members report their exposure on the stock market using a scale of 1 to 5, with 1 representing 100% cash and 5 representing 100% invested in stocks.
The NAAIM Exposure Index is a contrarian indicator. This means that it tends to move in the opposite direction of the stock market. When the stock market is rising, the NAAIM Exposure Index tends to fall, and when the stock market is falling, the NAAIM Exposure Index tends to rise.
This is because the NAAIM Exposure Index is based on the sentiment of active investment managers. When active investment managers are bullish on the stock market, they tend to increase their exposure to stocks. This drives up the NAAIM Exposure Index. However, when active investment managers are bearish on the stock market, they tend to reduce their exposure to stocks. This drives down the NAAIM Exposure Index.
The NAAIM Exposure Index can be used as a tool to identify potential turning points in the stock market. When the NAAIM Exposure Index is high, it suggests that active investment managers are bullish on the stock market and that a correction may be coming. However, when the NAAIM Exposure Index is low, it suggests that active investment managers are bearish on the stock market and that a rally may be coming.
The NAAIM Exposure Index has been on a downward trend for the past 3 years. In August 2020, the index was at 75.93, which is considered to be a neutral level. However, the index has since fallen to 65.49 in August 2023, which is considered to be a bearish level.
Conclusion:
It is highly likely that Micheal J Burry is not Alone!
Comment:
Since beginning of the August there was no 2 consecutive positive days for QQQ or SPY, this indicates the bearish sentiment is gaining momentum
Comment:
Michael J. Burry's historical performance in the past 2 decades has been mixed. He had a very successful run from 2000 to 2008, when his hedge fund, Scion Capital, returned 489.34%. This was due in large part to his bet against the subprime mortgage market, which paid off handsomely when the housing market collapsed in 2007.
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However, Burry's performance has been more muted since then. Scion Capital was closed in 2008, and Burry has since returned to managing his own money. His personal investment portfolio has returned 10.5% per year since 2008.
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However, Burry's performance has been more muted since then. Scion Capital was closed in 2008, and Burry has since returned to managing his own money. His personal investment portfolio has returned 10.5% per year since 2008.
Comment:
The probability of success or failure in any single event is not always 50-50%. It depends on the specific event and the conditions under which it is taking place.
For example, the probability of flipping a coin and getting heads is 50%. This is because there are two possible outcomes (heads or tails) and each outcome is equally likely.
However, the probability of winning a game of chess is not 50%. This is because there are many factors that can affect the outcome of a game of chess, such as the skill level of the players, the opening moves, and the luck of the draw.
In general, the probability of success or failure in any single event will be somewhere between 0% and 100%. The closer the probability is to 50%, the more likely it is that the outcome will be random. The closer the probability is to 0% or 100%, the more likely it is that the outcome will be determined by factors other than chance.
It is important to remember that probability is a measure of likelihood, not certainty. Just because the probability of an event is high does not mean that it will definitely happen. And just because the probability of an event is low does not mean that it will never happen.
For example, the probability of flipping a coin and getting heads is 50%. This is because there are two possible outcomes (heads or tails) and each outcome is equally likely.
However, the probability of winning a game of chess is not 50%. This is because there are many factors that can affect the outcome of a game of chess, such as the skill level of the players, the opening moves, and the luck of the draw.
In general, the probability of success or failure in any single event will be somewhere between 0% and 100%. The closer the probability is to 50%, the more likely it is that the outcome will be random. The closer the probability is to 0% or 100%, the more likely it is that the outcome will be determined by factors other than chance.
It is important to remember that probability is a measure of likelihood, not certainty. Just because the probability of an event is high does not mean that it will definitely happen. And just because the probability of an event is low does not mean that it will never happen.
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More Tightening & Restrictive FED monetary policies
Jerome Powell mentioned the words "tightening" and "restrictive" a total of 13 times in his speech at the Jackson Hole Symposium today, August 25, 2023.
"We believe there's more restriction coming."
"We're moving our policy stance purposefully to a level that will be sufficiently restrictive to return inflation to 2 percent."
"Restoring price stability will likely require maintaining a restrictive policy stance for some time."
"The historical record cautions strongly against prematurely loosening policy."
"We will need to be nimble in responding to incoming data and the evolving outlook."
"We will not hesitate to take stronger action if needed."
"We are committed to using our tools to bring inflation back down to our 2 percent target."
"We understand that higher interest rates will weigh on economic activity, but we believe the benefits of restoring price stability will outweigh the costs."
"We are confident that the US economy is strong enough to withstand tighter monetary policy."
"We will continue to communicate our plans transparently and clearly."
"We are committed to our dual mandate of maximum employment and price stability."
"We will do whatever it takes to achieve our goals."
These mentions of tightening and restrictiveness reflect the Fed's determination to bring inflation under control, even if it means slowing economic growth. Powell acknowledged that higher interest rates will weigh on the economy, but he said that the benefits of restoring price stability will outweigh the costs. He also stressed that the Fed is committed to communicating its plans transparently and clearly.
Jerome Powell mentioned the words "tightening" and "restrictive" a total of 13 times in his speech at the Jackson Hole Symposium today, August 25, 2023.
"We believe there's more restriction coming."
"We're moving our policy stance purposefully to a level that will be sufficiently restrictive to return inflation to 2 percent."
"Restoring price stability will likely require maintaining a restrictive policy stance for some time."
"The historical record cautions strongly against prematurely loosening policy."
"We will need to be nimble in responding to incoming data and the evolving outlook."
"We will not hesitate to take stronger action if needed."
"We are committed to using our tools to bring inflation back down to our 2 percent target."
"We understand that higher interest rates will weigh on economic activity, but we believe the benefits of restoring price stability will outweigh the costs."
"We are confident that the US economy is strong enough to withstand tighter monetary policy."
"We will continue to communicate our plans transparently and clearly."
"We are committed to our dual mandate of maximum employment and price stability."
"We will do whatever it takes to achieve our goals."
These mentions of tightening and restrictiveness reflect the Fed's determination to bring inflation under control, even if it means slowing economic growth. Powell acknowledged that higher interest rates will weigh on the economy, but he said that the benefits of restoring price stability will outweigh the costs. He also stressed that the Fed is committed to communicating its plans transparently and clearly.
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