Investor Michael Burry of ‘Big Short’ fame deregisters Scion Asset Management

Michael Burry attends "The Big Short" New York screening Ziegfeld Theater on Nov. 23, 2015 in New York City. (Astrid Stawiarz/Getty Images)

“Big Short” investor Michael Burry, known for his successful bets against the U.S. housing market in 2008, has deregistered his hedge fund, Scion Asset Management.

The Securities and Exchange Commission’s database showed Scion’s registration status as “terminated” as of November 10. Deregistering would imply the fund is not required to file reports with the regulator or any state.

Bets by Scion, which managed US$155 million in assets as of March, have long been dissected for hints of looming bubbles and signs of market froth.

In a post on social media platform X on Wednesday, Burry said, “On to much better things Nov 25th.” Scion Asset Management did not immediately respond to a Reuters request for comment.

Burry has stepped up criticism of technology heavyweights, including Nvidia and Palantir Technologies, in recent weeks, questioning the cloud infrastructure boom and accusing major providers of using aggressive accounting to inflate profits from their massive hardware investments.

Bearish AI bets

“Burry’s decision feels less like ‘calling it quits’ and more like stepping away from a game he believes is fundamentally rigged,” said Bruno Schneller, managing director at Erlen Capital Management.

Burry has argued that as companies such as Microsoft, Alphabet-owned Google, Oracle and Meta pour billions into Nvidia chips and servers, they are also quietly stretching out depreciation schedules to make earnings look smoother.

Between 2026 and 2028, those accounting choices could understate depreciation by about $176 billion, inflating reported profits across the sector, he estimated.

AI-related stocks have accounted for 75% of the S&P 500 index’s returns since November 2022, when OpenAI launched ChatGPT, J.P. Morgan Asset Management wrote in September.

“Don’t count him out, just expect him to operate off the grid for a while. He may simply pivot to a family-office setup and run his own capital,” said Schneller.

The investor’s short position against subprime mortgage securities during the housing market crash was chronicled in Michael Lewis’s book, “The Big Short,” and its film adaptation.

His profile on X, titled “Cassandra Unchained,” is seen as a nod to the Greek mythological figure cursed by Apollo to deliver true prophecies that no one would believe.

Investment advisers with assets under management of $100 million or more have to register with the SEC, and are primarily subject to federal regulation instead of state regulation.

Rough ride for short sellers

Burry joins a cast of high-profile investors navigating a market that has become increasingly hostile to bearish views in recent years, thanks to unfettered optimism around technology and strong interest from retail investors.

Hindenburg Research shuttered earlier this year after a string of high-profile calls, including bets against India’s Adani Group and U.S. electric-truck maker Nikola.

Veteran short seller Jim Chanos, best known for his bets against energy trader Enron months before the company’s bankruptcy, has also sparred with Michael Saylor’s bitcoin holding company Strategy.

Chanos has argued that Strategy’s valuation premium was unjustified, a critique that drew a sharp response from Saylor.

Reporting by Niket Nishant and Johann M Cherian in Bengaluru and Nell Mackenzie in London; Additional reporting by Aditya Soni and Manya Saini in Bengaluru; Editing by Anil D’Silva, Reuters