Investment master Michael Burry closes the Scion Fund and transitions to a new family office model

Recently, legendary investor Michael Burry, known for the movie “The Big Short,” announced a major decision—shutting down his long-standing hedge fund, Scion Asset Management. This move has shaken the investment community and sparked deep reflections on his changing investment strategy.

Aggressive Put Option Positions Reflect Market Concerns

According to the 13F filing submitted by Scion Asset Management to the U.S. Securities and Exchange Commission (SEC), Michael Burry’s portfolio is filled with defensive positions. Notably, put options make up 80% of the fund’s holdings, a high proportion that indicates his concerns about the current market.

Specifically, Burry’s put options on Palantir have a notional value of $912 million, equivalent to a protective hedge for 5 million shares. He also holds $186 million worth of put options on chip giant Nvidia. These large defensive positions send a clear signal: Michael Burry believes there is significant overvaluation in the market and is using options to systematically hedge against risks.

From Hedge Fund to Family Office: Strategic Shift

Michael Burry has withdrawn Scion Asset Management from the SEC registration list, meaning the fund will transition into a family office operation. This change is more than nominal; it signifies a deep strategic adjustment. Family offices are not required to report holdings to the SEC, giving Burry greater operational flexibility and privacy.

In a recent social media statement, Burry revealed that he has invested approximately $92 million in options to establish long-term hedging positions, with contracts extending into early 2027. This time horizon indicates that his assessment of current market risks is not short-term but based on long-term economic cycle observations.

Investment Guru’s Risk Warning

Through these actions, Michael Burry is sending a clear warning to the market. His large-scale put option positions not only protect his own portfolio but also express his views on asset valuations to the entire market. This approach is consistent with his pre-2008 financial crisis strategy—using precise risk identification and forward-looking position layouts to gain protection before major market adjustments.

The transition of Scion Asset Management from a public hedge fund to a family office marks a new phase in Burry’s investment journey, focusing more on long-term value assessment rather than short-term market performance.