The Big Shorter Shorts Again

Famed asset manager Michael Burry (of “The Big Short” fame) is credited with predicting the Housing Crash. But now, Burry’s predicting diminishing returns for a famous money manager: Cathie Wood. 

In its latest regulatory filing, Burry’s fund opened a bet against against the ARK Innovation ETF. Scion Asset Management purchased 2,355 put contracts against the ETF. According to Fintel, the value of the bet is worth over $30 million.

Hours after the news broke, ARK Invest’s Cathie Wood shared her two cents. Wood said that Burry doesn’t understand the fundamentals that are creating explosive growth and investment opportunities in the innovation space.

For Burry, it’s probably nothing personal. Earlier this year, Burry opened a put position against the Russell 2000 Growth ETF. He closed that bet in the latest quarter before opening up the ARK-related one. But that’s not even his wildest bet: Burry grew his existing $530 million put position against Tesla, the pick that brought Wood & ARK Invest to fame. In the latest quarter, Burry sized up the $TSLA short by 34%.

After reading all that, it’s hard to appreciate Burry’s other big bets and headlines — Burry made news earlier this year when he dropped serious dough on interest rate bets and Big Tech companies like Facebook and Alphabet. 

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How The Markets Performed In 2023

As our article about the ultra-wealthy showed, 2023 was a great year for assets (especially the publicly traded ones). Let’s take a quick peek at how things panned out. 👇

First, let’s start with the tech-heavy Nasdaq 100 index. The chart below shows that the index had one of its best rolling 12-month total returns in decades, rising 55%. The actual total return index also hit new all-time monthly closing highs, reiterating that bulls took back the momentum this year in a big way. 🤩

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Investors Ditch China For Nvidia

While everyone is looking at the S&P 500 closing above 5,000 as this week’s stat of the week, MarketWatch is flagging another wild data point. 🚨

As you can see from the headline snippet above, Nvidia is now worth as much as the entire Chinese stock market. While several stocks already have achieved this feat, they’re bigger conglomerates with many businesses under one roof. But Nvidia is a chip designer and manufacturer with a more straightforward business model, making this that much crazier of an occurrence. 

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Microsoft Briefly Overtakes Apple

While most of the market focused on the spot Bitcoin ETFs beginning to trade today, the second-largest company in the world made a move on its sole competitor. 🔮

This morning, Microsoft’s market capitalization briefly crossed that of Apple’s, making it the largest company in the world. While it didn’t last, it does beg the question of which stock will lead the market going forward.

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Traders’ Updated S&P 500 Roadmap

Just because the calendar changes dates doesn’t mean the market’s trends do. As such, now seems like a great time to update the S&P 500 roadmap many traders used throughout 2023. 🗺️

Below is a two-year daily candlestick chart with a few key indicators. The first is the 200-day moving average (blue), which traders use to track the long-term trend in the market. The next two are the anchored volume weighted average price (AVWAP) from the market’s 2022 highs and 2022 lows. Traders use this to track how the average buyer/seller has fared in the market from a specific date.

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