Michael Burry, famous for predicting the subprime mortgage crisis, has made a significant investment in a physical gold trust during the first quarter, according to a recent regulatory filing. Burry, who now manages Scion Asset Management, purchased over 440,000 units of the Sprott Physical Gold Trust (PHYS), valued at more than $10 million. The closed-end fund holds its assets in physical gold bullion and is currently trading at a discount to its net asset value. Gold prices have been rising, reaching new highs due to factors like reaccelerating inflation and geopolitical tensions.
In addition to his investment in the gold trust, Burry also increased his positions in Chinese e-commerce giants JD.com and Alibaba in the last quarter. His top holdings at the end of March included companies like HCA Healthcare, Citigroup, and Block. Burry gained notoriety for his successful bet against mortgage-backed securities before the 2008 financial crisis, as depicted in Michael Lewis’ book “The Big Short” and the subsequent movie adaptation. Money managers with over $100 million in assets are required to disclose their long positions with the SEC 45 days after the end of a quarter, though it’s possible that active traders like Burry may have altered their positions by the time filings are made public.
The Sprott Physical Gold Trust (PHYS) that Burry invested in has been trading at a discount to its net asset value, with a current discount of 1.67% compared to its 52-week average of 1.57%. The fund has not traded at a premium to NAV in the past year, with the widest discount reaching 2.52%. Gold prices have been on the rise, with U.S. gold futures reaching highs above $2,400 per ounce last month. This surge in gold prices can be attributed to concerns over inflation as well as escalating geopolitical risks.
It’s worth noting that Burry’s investment decisions reflect his views on the current economic climate and market conditions. By opting to invest in a physical gold trust and increasing his bets on Chinese e-commerce companies, he is likely positioning his portfolio to capitalize on emerging trends and opportunities in the market. Burry’s success in predicting and profiting from major financial events in the past has earned him a reputation as an astute investor with a keen eye for identifying profitable investment opportunities.
As an influential figure in the world of finance, Michael Burry’s investment moves are closely watched by investors and analysts alike. His decision to make gold his biggest bet in the first quarter signals his confidence in the precious metal as a safe-haven asset amidst economic uncertainty. By adjusting his portfolio holdings to include positions in companies like JD.com and Alibaba, Burry is also leveraging the growth potential of key players in the Chinese e-commerce sector. As the investment landscape continues to evolve, Burry’s strategic choices will continue to be scrutinized for insights into market trends and potential opportunities for investors.
