Burry Takes Aim at AI Stocks With $1.1 Billion Put Options Bet

Michael Burry, known for his prescient bets against subprime mortgage bonds in the 2000s, has disclosed put options worth an estimated $1.1 billion against Nvidia and Palantir before closing his hedge fund Scion Asset Management.

Burry's latest bet is similar to his 'big short' trade against subprime mortgages, where he was early but ultimately correct in predicting a market downturn.

He held 50,000 put options on Palantir with a notional value of $912 million and 10,000 puts on Nvidia with a notional value of $186,580. The actual capital at risk is limited to the premiums paid for the options, which were just a few pennies per share.

Burry has called into question Palantir's ability to keep growing, saying the stock could be worth less than $1 per share in the long term. He also believes Nvidia's heavy customer concentration is a significant risk, citing potential drops in revenue if hyperscalers dial back their capital spending plans.