Michael Burry bets on Cathie Wood: Fight the hedge fund economy

In superhero series, the situation becomes especially dire when good no longer fights evil, but two heroes clash. The modern hero is no longer a boring benefactor, but also has his problems, fears, needs and hopes. Superhero comics are no longer black and white – and suddenly in the battle between heroes and heroes, it is open to whom the sympathies of the public belong.

A similar battle is now on Wall Street. Two star investors compete: Michael Burry bets against Cathie Wood. Burry became famous for the movie “The Big Short”, which deals with the background of the financial crisis. Christian Bale plays the director of the capital Burry in the film adaptation of the book of the same name. His hedge fund Scion bet early and – as it has unfortunately turned out to the rest of humanity – successfully that the so-called risky real estate papers were worthless. Since then, the financial world has noticed when Burry is betting again. Fund manager Wood, on the other hand, is viewed by many as a star investor as she has had great success with technology investing. Your fans can buy vests, hoodies and polo shirts with the logo of their hedge fund called Ark.

Burry warns of “mother of all accidents”

Burry’s hedge fund Scion has now announced that it has placed so-called sales contracts worth nearly $ 31 million against Ark’s largest fund, the Ark Innovation ETF. Wood brought with him billions of dollars in investor capital. A sales contract gives Scion the right to sell shares of the Ark Fund before a specified date and at a previously agreed price. Burry wins this bet if Ark’s price falls below this threshold. The exact terms of the put options and their purchase date are not known.

Burry believes that the prices of most of the selected Wood companies are grossly exaggerated. He does not see innovations that will bring a lot of profit in the future, but a bubble that will burst. In June, he warned that investing in cryptocurrencies and stocks even recommended for purchase on forums like Reddit could put investors in the “mother of all crashes.” By the way, Burry is betting even more against Tesla. Wood, on the other hand, puts most of the money in his fund on the electric car maker. Wall Street is watching who wins this fight.

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