Subprime "Big Short" makes big moves in the second quarter! As the stock investment portfolio is halved, it increases its stake in Alibaba to the top position

Michael Burry, the "big short" who made money during the subprime mortgage crisis, made significant moves in the second quarter of this year. He further increased his holdings in Alibaba and Baidu, with Alibaba surpassing JD.com to become his largest holding as of June 30. While adding to Chinese internet giants, he drastically reduced his overall stock portfolio by half.

Burry rose to fame during the 2007 subprime mortgage crisis by gaining international recognition for shorting. His story was even adapted into the movie "The Big Short."

According to the latest 13F filing submitted to the U.S. SEC by Scion Capital on Wednesday, Burry's investment firm, Scion Asset Management, reported that in the second quarter, they increased their holdings of Alibaba by 30,000 shares. The position value increased from $9 million in the first quarter to $11.2 million, making it their largest holding.

In the second quarter, Scion also increased their holdings of Baidu by over 30,000 shares, valued at $2 million. The filing shows that as of June 30, they held 75,000 shares of Baidu, valued at $6.5 million.

In the previous quarter, Scion reduced their holdings in JD.com. They sold 110,000 shares in the second quarter, worth slightly over $3 million. However, JD.com still remains one of the major stocks in Scion's investment portfolio.

In the first quarter of this year, Scion significantly increased their investments in Chinese internet giants, including JD.com, Alibaba, and initiating a position in Baidu. By the end of the first quarter, JD.com and Alibaba became their top two heavy-weight stocks, with an increase in holdings of 80% and 66.67% respectively.

In fact, since the fourth quarter of 2022, Alibaba and JD.com have been part of Scion's portfolio, but the decisive buying occurred in the first quarter of this year.

Payment technology provider Shift4 Payments is the second-largest holding of Scion, with a total net value of approximately $7.3 million. In the second quarter, Scion established a new position in Shift4, purchasing 100,000 shares.

During the second quarter, Scion initiated new positions in various industries including financial services, healthcare, and commercial real estate. In addition to Shift4 Payments mentioned above, Molina Healthcare and real estate investment trust company Hudson Pacific Properties were also new holdings, with individual stock holdings valued at over $5.5 million.

Scion also increased their holdings in beauty company Olaplex and biotechnology company BioAtla during the reporting period.

In the second quarter, Scion reduced their holdings in luxury resale retailer RealReal.

Scion exited positions in several targets during the quarter, including HCA Healthcare, Citigroup, payment service provider Block, healthcare company Cigna Corporation, and automotive parts retailer Advance Auto Parts As of the second quarter, Scion company held a total of 10 stocks, with a total value exceeding $52 million, a scale that decreased by an astonishing nearly 50% compared to the previous quarter.

Michael Burry's name once made Wall Street tremble, with his long and short operations attracting market attention. While increasing his holdings in Chinese concept stocks, reducing positions in other areas is not something he has done for the first time this year. As of the end of the first quarter this year, his 13F filing showed that while going long on Chinese concept stocks, Burry liquidated Google and Amazon, two of the "most bullish seven sisters" in the US stock market.

The "Big Short" sentiment towards the US market has been continuously escalating since 2019, constantly warning of the high risks of the US stock market through social media platforms. He even posted in 2022, "That familiar stupidity hasn't disappeared yet."

So far this year, the "Big Short" actions have been quite targeted. What has he sensed this time?