If You Invested $1,000 In SPY And QQQ When Michael Burry Went Big Short In 2020, Here's How Much You'd Have Today

Investor and hedge fund manager Michael Burry is known for his calls on the stock markets over the years. A recent quarterly filing from Burry showed he placed a significantly bearish bet on the U.S. stock market.

Here’s a look at some recent history of Burry’s bearish calls and how an investment in the opposite direction could have turned out for investors.

What Happened: A filing from Burry showed he purchased 40,000 puts on the SPDR S&P 500 ETF Trust SPY and the Invesco QQQ Trust Series 1 QQQ, two of the most widely followed ETFs in the U.S.

Burry has 20,000 put options on the SPY and 20,000 put options on the QQQ. These investments suggest Burry thinks the stock market will trend down in the coming months and stocks are currently overvalued.

The bets from Burry come as the SPY and QQQ are up 15.1% and 37.4% year-to-date respectively, led by surging valuations of technology stocks.

Not everyone is convinced Burry is right. The topic of Burry’s investment was a recent hot take on Benzinga’s “PreMarketPrep” show.

Guest Marc Chaikin of Chaikin Analytics is among those who believed Burry is wrong.

“He’s going to be wrong — there are others out there a lot smarter than Burry,” Chaikin said.

Chaikin called Burry a “one-trick pony.”

While Burry is best known for nailing the housing market collapse in 2008, a concept that was turned into a book and movie titled "The Big Short," his predictions have not fared as well since then. 

A Twitter user shared a chart highlighting the calls from Burry for market collapses, which have often proved wrong over a 12-month time horizon.

The chart highlighted many times Burry was wrong and how at times there would be a slight drop in the broad market, only to see a recovery shortly after.

In March 2020, Burry told Bloomberg that he was betting on the stock market falling.

“Buy the fear in the markets is being paralleled by growing fear of the virus, and the twofer is toxic to market sentiment,” Burry said.

The investor said that he was worried about a “bubble” around passive investment trends.

“I have had a significant bearish market bet that is working out for now.”

The comments from Burry on March 13, 2020, came as the COIVD-19 pandemic was still in the early days.

“A global pandemic is absolutely a potential trigger for the unwinding of the passive investing bubble. With COVID-19, the hysteria appears to me worse than the reality, but after the stampede, it won’t matter whether what started it justified it.”

Related Link: Here Are The Eyebrow Raising Moves Warren Buffett, Michael Burry And Bill Ackman Made Recently 

If You Invested $1,000 SPY, QQQ: Investors who bet against Burry in March 2020 would have enjoyed strong returns over the last three years and five months.

A $1,000 investment on March 13, 2020, could have purchased 3.92 shares of SPY. The $1,000 investment would be worth $1,716.76 today. This represents a hypothetical return of +71.7% over the last three years and five months.

A $1,000 investment on March 13, 2020, could have purchased 5.31 shares of QQQ. The $1,000 investment would be worth $1,927.37 today. This represents a hypothetical return of +92.7% over the last three years and five months.

Read Next: How To Earn $500 A Month From SPY Stock 

Image: Benzinga