Burry's Investment: Tale of Gains & Losses.
Your Wish, My Command.
It was slightly over a year ago that I had a post on Michael Burry’s portfolio. 01 Jan 2024 to be precise. (click here ! to read)
One of my readers had subsequently left a comment asking if there was any update/s to Burry’s portfolio.
There wasn’t back then. However, there is now !
Whoever has asked, consider the request fulfilled.
Let’s Take A Look.
Michael Burry, the famed investor depicted in ‘Big Short,’ has long been known for his bold stock picks.
His 2024 portfolio was no exception, featuring a mix of Chinese technology giants, healthcare firms, and growth stocks.
Indeed, his portfolio had diverse returns over the past year, with some stocks recording notable gains while others faced industry-specific headwinds.
Per the latest 13-F filing on 14 Nov 2024, Burry’s portfolio showcased his knack for unconventional picks. (see below)
Burry’s Portfolio Returns
(1) Red Chips.
Chinese technology stocks like $Alibaba(BABA)$ and $JD.com(JD)$ were notable performers, rallying 15.94% and 36.13%, respectively. (see above)
However, not all Chinese tech fared well. $Baidu(BIDU)$, another major holding, had a difficult year, plummeting -25.90%. (see above)
It’s worth noting that Chinese stocks initially rallied in October 2024, when the market surged briefly after the government announced stimulus measures to boost stocks.
However, the rally quickly faded as the stimulus fell short of investor expectations.
(2) Healthcare.
Traditionally a defensive sector, it proved to be challenging for Burry’s portfolio. $Molina Healthcare(MOH)$ struggled with a -25.70% loss. (see above)
(3) Beauty Stock.
While $Olaplex Holdings, Inc.(OLPX)$, a beauty and wellness company, plunged even further, losing -28.44%. (see above)
High Growth To The Rescue.
Thankfully, it is not all doom & gloom in Burry’s portfolio.
Some of the gems, brightest stars of Burry’s portfolio were in the high-growth sector.
Shift4 Payments (NYSE: FOUR) soared +42.07%. (see above)
While American Coastal Insurance (NASDAQ: ACIC) delivered a strong +19.82% return. (see above)
The undisputed standout was The RealReal (NASDAQ: REAL), a luxury consignment company. (see above)
With a jaw-dropping +379.80% rally in 2024, it was the crown jewel of Burry’s investments, dwarfing the returns of any other stock in the portfolio.
Burry’s Portfolio Returns
For investors who admire Burry’s investment picks, allocating $1,000 to his portfolio would have produced diverse returns.
An equal $125 allocation across eight stocks resulted in a rollercoaster of outcomes, with big winners offsetting notable losses.
By the end of 2024, a $1,000 investment would have grown to $1,742.37, delivering a +74.24% return.
It’s worth noting that Burry’s portfolio could have achieved significantly higher returns had he not abandoned his semiconductor sector bet in 2023.
Indeed, the semiconductor sector was among the standout performers in 2024, led by companies like Nvidia (NASDAQ: NVDA).
In conclusion, Burry’s 2024 portfolio highlights the significance of diversification.
Despite setbacks in some picks, the investor’s ability to identify growth stocks delivered a solid return for investors, underscoring his status as one of Wall Street’s most dynamic and effective strategists.
My viewpoints : (mine only).
A picture paints a thousand words.
-
I have grouped all the stocks mentioned above into one chart, except for RealReal.
-
If it is included, it will skew overall display, owing to its “astronomical” stock price rise.
-
Also, It is a pity that the S&P 500 index could not be included with the stocks, as that would provide an even clearer picture.
Still, it could be seen that the 3 Chinese stocks began to pull back after Donald Trump was declared winner on 06 Nov 2024.
Apart from that, Burry picked of healthcare stock Molina Healthcare Inc (MOH)$ is a “strange” pick too (to me).
-
At $294.49 a share, (as of 3 Jan 2025 closing price), it is an “expensive” stock.
-
What’s more MOH’s average trading volume is only 735,819.
Disadvantages associated with a ‘low’ trading volume stock: (see below)
-
Low Liquidity: Makes it difficult to quickly buy or sell shares without impacting the stock price.
-
Wide Bid-Ask Spread: Higher difference between the buying and selling price, leading to less favorable trade executions.
-
Price Manipulation: Easier for market makers to manipulate prices due to fewer transactions.
-
Difficulty in Profit Taking: Harder to sell large quantities without causing a price drop.
-
Limited Interest: Indicates low investor interest, which could be a sign of underlying issues with the company.
Beauty Is Only Skin Deep.
There is definitely a lot of truth to above proverb.
When it comes to investing, I would not bet on ‘beauty’ stock because:
-
They are not what they used to be.
-
Premium brand like Estee Lauder (EL)$ has lost its “shine”. The stock fell by -48% in 2024. (see below)
-
Korean skin care brands have become more popular in recent times due to constant innovations.
-
Even Warren Buffett’s Berkshire Hathaway (BRK.B)$ suffered a lost when out of the blue it bought into Ulta Beauty (ULTA)$; only to offload it few months later, at a loss. (click here ! to read about it)
-
As for Olaplex (OLPX)$, came across this brand when the Kim Kardashian was the peak of her popularity and still married to Kayne West.
-
She dyed her hair platinum blonde and used Olaplex hair series to keep her locks in tip top conditions. She swore by it.
-
Since then, the brand has kind of lost its shine overtime.
As for Burry’s 3 growth stocks, I am only remotely interested to find out a bit more about American Coastal Insurance (ACIC)$.
At $12.39 a pop, it is relatively “affordable” investment. Still have to do my homework before ascertaining if it is a “Buy” now or wait patiently for a better entry price.
I am interested to find out more about insurance stocks, thanks to Mr Warren Buffett - the kingpin of insurance stocks.
The 9 insurance companies under Berkshire Hathaway are responsible for 25% of the group’s total revenue. Insurance can be profitable, when the price is right. Even Berkshire latest purchase of insurance company Chubb Ltd (CB)$ was shrouded in mystery initially. Need I say more ?
Must Read: Click on below titles to access. Repost to share, Like as encouragement ok. Thanks.
-
Do you think insurance business (ACIC)$ might be worth a 2nd look ?
-
Do you think Chinese stocks still have runway to take flight as ex-President is returning soon?
If you find this post interesting, give it wings! ️ Repost and share the insights ?
Do consider “Follow me” and get firsthand read of my daily new post. Thank you.
Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.
Pls "Re-post" so that more get to know. Tks! Rating is important (to me).
Consider "Follow me" and get first hand read of my Daily new posts? Thanks!). Tks!!
Great article, would you like to share it?
Great article, would you like to share it?