Michael Burry, the investor famous for betting against the housing market before the 2008 financial crisis, is once again making headlines with his bearish wagers. This time, he's targeting the AI trade that has powered the stock market to record highs.
In his latest portfolio update, Burry added to his existing put options on Nvidia (NVDA), increased his short positions in Micron Technology (MU) and the iShares Semiconductor ETF (SOXX), and added more puts on the Invesco QQQ Trust (QQQ). These moves signal a deepening skepticism about the sustainability of the AI-driven rally in tech stocks.
It's worth clarifying what these positions actually mean. Buying a put option isn't the same as shorting a stock. When Burry buys a put, he's purchasing the right to sell the stock at a set price before the option expires. If the stock falls, the put increases in value, and he profits. If the stock rises, his loss is limited to the premium he paid for the option. So while these are bearish bets, they come with a defined downside.
ETF Investors in the Crosshairs
Burry's moves put several popular AI and semiconductor ETFs under the microscope. His expanded short position in SOXX is a direct bet against the U.S. semiconductor industry. The ETF holds roughly 30 leading chipmakers, including Nvidia, Broadcom (AVGO), Advanced Micro Devices (AMD), Qualcomm (QCOM), and Micron. It's a go-to vehicle for investors wanting broad exposure to the AI hardware boom.
The VanEck Semiconductor ETF (SMH) is also in the spotlight, given its heavy allocation to Nvidia, the dominant player in AI chips. Meanwhile, QQQ, which tracks the Nasdaq-100, derives a large chunk of its performance from mega-cap tech companies, making it sensitive to swings in AI sentiment.
A Contrarian Bet Against a Winning Theme
Burry's bearish positioning comes at a time when semiconductor stocks are flying high. Micron shares have surged around 200% year-to-date, fueled by red-hot demand for high-bandwidth memory (HBM) chips used in AI servers. Nvidia remains one of the biggest beneficiaries of the AI infrastructure buildout, and semiconductor ETFs have been among the best-performing fund categories this year.
The sector is still attracting serious money. Semiconductor ETFs have pulled in about $46 billion in net inflows in 2026, which is roughly 31% of their starting assets. That's a massive vote of confidence from investors who believe the AI trade has more room to run.
Should ETF Investors Take Notice?
Burry has built his reputation on making high-conviction contrarian calls, but his timing has often been early. He's been known to hold positions for months or even years before the market catches up to his view.
His latest portfolio update doesn't necessarily mean the AI rally is about to end. But it does underscore growing concerns about elevated valuations and concentration risk within semiconductor and tech ETFs. Many of these funds rely heavily on Nvidia and a handful of other AI leaders for their returns, which can be a double-edged sword.
For ETF investors, Burry's moves are less a call to abandon AI and more a reminder that one of Wall Street's most closely watched bears is positioning for the possibility that the sector's remarkable run could eventually cool. Whether he's right or wrong, his bets are a signal worth paying attention to.
