Michael Burry, who profited greatly from an unprecedented bet against mortgage securities before the financial collapse of 2008, is trying to do the same thing with Tesla (TSLA) stock. According to a filing cited in many different media outlets, Burry had put contracts for 800,100 shares of the company as of March 31. The value of those 800,100 shares was right under $535 million.

A put is an investor strategy that gives someone the right to sell shares at a certain price, called the strike price, by a certain date. The filing did not show what his set strike price or date was.

Burry is among the central figures in the 2010 book by Michael Lewis, called The Big Short and the 2015 film by the same name.

He is among the few investors who bet against mortgage companies before they helped to trigger the crisis of 2008 and 2009. Mortgage securities were very popular before the collapse, and it was very unusual for any large investor to be bearish on them.

Burry has not publicly mentioned his Tesla puts.

Although Tesla keeps being a hot stock for investors, the company has had some setbacks. Among other negatives, one of its cars — which was maybe powered by its autopilot function — was recently involved in a crash that left one person dead, and the opening of upcoming gigafactory in Germany has been postponed later than expected.

Perhaps the news of Burry’s put is giving Tesla fans some pause to think. The stock dropped by 2.2% on Monday, a lower decline than the S&P 500’s 0.3%.

 

Author: Blake Ambrose

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