1. Overview of Portfolio Composition

As of the end of Q2 2024, Michael Burry’s Scion Asset Management reported a portfolio consisting of only 10 holdings, significantly reduced from previous quarters. The total portfolio value was approximately $52.5 million, down from $103 million in Q1 2024 (13F Info – SEC 13F Filings). This marked a strategic consolidation, with Burry focusing on fewer, high-conviction investments.

Top Holdings:

• Alibaba Group Holding (BABA): 21.26% of the portfolio.
• Shift4 Payments (FOUR): 13.97%.
• Molina Healthcare (MOH): 13.89%.
• Baidu (BIDU): 12.36%.
• JD.com (JD): 12.31%.

These five holdings represented over 70% of the portfolio, indicating a highly concentrated investment strategy, typical of Burry’s approach(

2. Market Context and Portfolio Performance

The second quarter of 2024 saw mixed market conditions, with several macroeconomic factors influencing equity performance:

• Chinese Stocks: Burry’s significant exposure to Chinese tech stocks like Alibaba and Baidu was a bet on a recovery in the Chinese economy. However, geopolitical tensions and regulatory challenges continued to weigh on these stocks. Alibaba, for instance, saw a modest recovery but remained volatile.
• U.S. Healthcare: Molina Healthcare, a U.S.-based company, benefited from stability in the healthcare sector, driven by continued demand and regulatory support. This holding likely provided a defensive anchor in Burry’s portfolio.
• Technology and Payments: Shift4 Payments, a U.S.-based payment processing company, reflected Burry’s interest in the technology sector, particularly fintech. The stock performed well, aided by increasing consumer spending and the adoption of digital payments

3. Portfolio Adjustments and Turnover

Burry made several significant changes during the quarter:

• Complete Sales: He exited positions in Citigroup, Block, Cigna, and BP, reflecting a strategic shift away from financials and energy. These sales likely realized losses, contributing to the overall reduction in portfolio size.
• New Positions: Additions included more speculative plays like BioAtla and Olaplex, which represented smaller percentages of the portfolio. These stocks, while high-risk, indicate Burry’s continued willingness to bet on undervalued or turnaround opportunities

4. Risk and Return Analysis

Given the concentrated nature of Burry’s portfolio, the risk profile is inherently high. With significant exposure to volatile sectors like technology (especially Chinese tech) and healthcare, the portfolio is sensitive to sector-specific risks and broader market volatility.

• Beta and Volatility: The portfolio’s beta is likely above 1, given its concentration in high-beta stocks like Alibaba and Shift4 Payments. This suggests that the portfolio would outperform in a bullish market but underperform in a downturn.
• Downside Risk: The significant drawdown in portfolio value indicates that Burry’s strategy in Q2 2024 faced substantial downside risk, particularly from his high exposure to Chinese equities, which remained under pressure due to external factors.

5. Strategic Considerations

Burry’s Q2 2024 strategy reflects a high-conviction, high-risk approach. His concentrated bets on specific sectors, particularly Chinese technology and U.S. healthcare, suggest a belief in the long-term value of these industries despite short-term challenges.

However, the significant reduction in portfolio size and the complete divestment from certain sectors could also indicate a defensive posture, potentially anticipating further market turbulence. Burry’s historical contrarian stance and tendency to take big, concentrated positions are evident in this quarter’s portfolio structure

6. Conclusion

Michael Burry’s Q2 2024 portfolio exemplifies a high-risk, high-reward strategy with concentrated bets on select industries. The performance of this portfolio will be highly dependent on macroeconomic conditions, particularly the recovery of Chinese technology stocks and the stability of the U.S. healthcare sector. Given the significant portfolio turnover and reduction in size, Burry appears to be navigating a cautious yet opportunistic path, balancing defensive positions with speculative investments.

As of Q2 2024, Michael Burry’s portfolio through Scion Asset Management reveals strategic moves across various sectors. Below is a detailed overview of his top 10 holdings:

BABA – Alibaba Group Holdings

• Portfolio Allocation: 21.26%
• Recent Activity: Added 24.00%
• Shares Held: 155,000
• Reported Price: $72.00 per share
• Value at Reported Price: $11,160,000

Alibaba Group remains the largest position in Burry’s portfolio, with a substantial increase in shares. This indicates strong confidence in the company’s recovery and long-term growth prospects, especially in the e-commerce and cloud computing sectors.

FOUR – Shift4 Payments Inc. CL A

• Portfolio Allocation: 13.97%
• Recent Activity: New Buy
• Shares Held: 100,000
• Reported Price: $73.35 per share
• Value at Reported Price: $7,335,000

The addition of Shift4 Payments to the portfolio reflects Burry’s confidence in the payment processing industry, particularly in a company that is known for its innovative solutions in the financial technology space.

MOH – Molina Healthcare Inc.

• Portfolio Allocation: 13.89%
• Recent Activity: New Buy
• Shares Held: 24,530
• Reported Price: $297.31 per share
• Value at Reported Price: $7,293,000

Molina Healthcare’s inclusion as a new position suggests that Burry sees potential in the healthcare sector, focusing on companies that are well-positioned to benefit from ongoing changes in healthcare policy and services.

BIDU – Baidu Inc.

• Portfolio Allocation: 12.36%
• Recent Activity: Added 87.50%
• Shares Held: 75,000
• Reported Price: $86.48 per share
• Value at Reported Price: $6,486,000

The significant increase in Baidu shares shows Burry’s optimism about the company’s future, particularly in areas such as artificial intelligence and autonomous driving technology.

JD – JD.com Inc.

• Portfolio Allocation: 12.31%
• Recent Activity: Reduced 30.56%
• Shares Held: 250,000
• Reported Price: $25.84 per share
• Value at Reported Price: $6,460,000

Burry’s reduction in JD.com suggests a strategic rebalancing, perhaps due to concerns over the competitive landscape or broader market conditions affecting Chinese tech companies.

HPP – Hudson Pacific Properties Inc.

• Portfolio Allocation: 10.49%
• Recent Activity: New Buy
• Shares Held: 1,144,435
• Reported Price: $4.81 per share
• Value at Reported Price: $5,505,000

Hudson Pacific Properties’ addition indicates Burry’s interest in the real estate sector, focusing on properties that could potentially benefit from urban recovery and changing work environments.

REAL – RealReal Inc.

• Portfolio Allocation: 6.08%
• Recent Activity: Reduced 29.21%
• Shares Held: 1,000,000
• Reported Price: $3.19 per share
• Value at Reported Price: $3,190,000

The reduction in RealReal shares may reflect Burry’s cautious outlook on the luxury consignment market, possibly due to changing consumer behavior or competitive pressures.

ACIC – American Coastal Insurance Co.

• Portfolio Allocation: 5.06%
• Recent Activity: No change reported.
• Shares Held: 251,892
• Reported Price: $10.55 per share
• Value at Reported Price: $2,657,000

American Coastal Insurance’s stable position indicates confidence in the insurance sector, particularly in companies that offer niche services with steady demand.

OLPX – Olaplex Holdings Inc.

• Portfolio Allocation: 2.92%
• Recent Activity: New Buy
• Shares Held: 995,250
• Reported Price: $1.54 per share
• Value at Reported Price: $1,533,000

The purchase of Olaplex Holdings reflects an interest in the consumer goods sector, particularly in beauty and personal care products that have a strong brand presence and growth potential.

BCAB – Bioatla Inc.

• Portfolio Allocation: 1.66%
• Recent Activity: New Buy
• Shares Held: 633,959
• Reported Price: $1.37 per share
• Value at Reported Price: $869,000

Bioatla’s addition to the portfolio suggests that Burry sees potential in the biotechnology sector, possibly betting on innovative therapies that could deliver high returns if successful.

Analysis of Top Holdings:

1.   Alibaba Group Holdings: The largest position, with a significant increase, indicating strong belief in the company’s recovery and long-term growth potential.

2.   Shift4 Payments Inc.: New addition, reflecting confidence in the financial technology space.

3.   Molina Healthcare Inc.: Another new position, showcasing Burry’s interest in the healthcare sector.

4.   Baidu Inc.: Large increase, indicating optimism in the company’s technology and AI initiatives.

5.   JD.com Inc.: Reduced position suggests strategic rebalancing amid potential market concerns.

6.   Hudson Pacific Properties Inc.: New buy, showing interest in real estate, particularly in urban-focused properties.

7.   RealReal Inc.: Reduced holdings may indicate cautious outlook on luxury consignment.

8.   American Coastal Insurance Co.: Stable position, reflecting confidence in niche insurance services.

9.   Olaplex Holdings Inc.: New position in consumer goods, focusing on the beauty and personal care market.

10. Bioatla Inc.: New buy in the biotechnology sector, indicating a bet on innovative therapies.

Overall, Michael Burry’s Q2 2024 portfolio demonstrates strategic adjustments with significant investments in technology, healthcare, and real estate sectors, while maintaining a cautious approach in other areas. His portfolio reflects a blend of growth-oriented bets and value-driven investments.