Michael Burry reportedly converts some technology-stock shorts into long-dated put options

AT A GLANCE

below their respective all-time highs. Reports say Michael Burry converted some AI-related shorts into put options, betting that the AI bubble will burst sooner.

Article

“The Big Short” Michael Burry accelerates his bet AI Crash: The bubble may burst sooner than expected

BlockBeats news,September 29, according to CNBC reports, Michael Burry, the real-life inspiration for “The Big Short,” is bringing forward his assessment of a turning point in AI market conditions and has converted portions of his outright short positions in Micron Technology, Nebius, Palantir, and iShares Semiconductor ETF（SOXX) into put options to obtain higher leverage at lower cost.

In his latest investment newsletter, Burry said: “From a fundamental perspective, I am moving up my timetable and therefore want to increase the leverage of my short positions. Leverage is also easier to accept when the timing assessment is clearer. Nothing embodies leverage better than options; with volatility indicators such as VIX currently extremely low, put options are relatively inexpensive.” He said some of the adjustments were made to reduce tax burdens, but the main reason was his view that the “AI bubble may burst sooner rather than later.” His main current position adjustments include:

· Replacing the Micron Technology short position with put options expiring next year June with strike prices in the 500 USD range;

· Replacing the Nebius short position with put options expiring next year June with strike prices in the double-digit range;

· Replacing the SOXX short position with put options expiring in 2027 year September with strike prices just above 400 USD;

· Rolling over and expanding Palantir’s existing short and put-option positions, centered on put options expiring in 2027 year September with strike prices just above 100 USD.

Citing research from Ares Management, he said the current AI investment boom depends on companies continuing to expand capital expenditures and on insufficiently validated AI revenue. If just one quarter of AI revenue falls below expectations supporting the related capital expenditures, some corporate boards may reallocate funds to other high-certainty projects; existing legal agreements also allow room for such adjustments.

In addition to AI commercial returns, Burry remains bearish on the memory-chip cycle. Citing comments by Acer CEO Jason Chen, he said that as China’s memory-chip capacity continues to expand, the industry cannot sustain supply shortages indefinitely, and the memory market will ultimately return to cyclical fluctuations.

Burry has remained bearish on technology stocks this year.May he said the current market resembled the final months before the dot-com bubble burst between 1999 and 2000. However, U.S. equities subsequently continued to reach new highs, with the Nasdaq Composite setting a record last week; Micron and Palantir are currently approximately 16%and 10%。

Key points

BlockBeats, citing CNBC reports, said that Michael Burry has brought forward his assessment of a turning point in AI market conditions.
It reported that he converted portions of his outright short positions in Micron Technology, Nebius, Palantir, and iShares Semiconductor ETF（SOXX) into put options.
Burry said that, with volatility indicators such as VIX extremely low, put options are relatively inexpensive; some adjustments were also made to reduce tax burdens.
The replacement put options for both Micron Technology and Nebius expire next year June.
SOXX The core put options for 2027 Palantir all expire in September.
Citing research from Ares Management, Burry said the current AI investment boom depends on companies continuing to expand capital expenditures and on insufficiently validated AI revenue.
Citing comments by Acer CEO Jason Chen, Burry said that as China’s memory-chip capacity continues to expand, the memory market will ultimately return to cyclical fluctuations.
The report said that U.S. equities subsequently continued to reach new highs, with the Nasdaq Composite setting a record last week; Micron and Palantir are approximately 16%and 10%。

AI-assisted interpretation

The following is analysis, separate from reported facts. Verify important claims independently.

Outright short selling typically incurs continuing losses when prices rise; put options instead exchange an option premium for the opportunity to profit if the underlying asset declines. By converting some outright short positions into put options, Burry seeks to increase bearish exposure and leverage at lower cost. This reflects his investment assessment and does not prove that AI market conditions or the related stocks will necessarily decline.

Why it matters to readers

These adjustments show that Burry is increasing his bearish bets on AI returns on capital expenditures, semiconductors, and the memory-chip cycle. If AI revenue is insufficient to support capital expenditures, the research cited in the report suggests that some companies may redirect funds to other projects; however, a single investor’s position changes cannot themselves determine market direction.

Beginners can view this news as a case study of an investor’s high-risk bearish strategy, focusing on distinguishing between “position changes,” “personal predictions,” and “market outcomes that have already occurred,” and should not mistake put options for a certainty of profit.

Risks and unknowns

Reported by BlockBeats based on a secondary source CNBC, the evidence does not provide the full text of Burry’s investment newsletter or regulatory filings, so his complete positions cannot be verified.
“AI“the bubble may burst earlier” is Burry’s prediction; whether it will occur and when remain unknown.

Michael Burry reportedly converts some technology-stock shorts into long-dated put options

Article

AI-assisted interpretation

Why it matters to readers

Risks and unknowns

Related Developments

Related concepts

Keep following

Security Center