Michael Burry’s Original Blog, Water Investments, Interviews

As mentioned earlier, Michael Burry is a rather secretive investor. After having shut down Scion Capital in 2008 to focus on his own portfolio, Burry came back in 2013 to raise money for a new fund, Scion Asset Management. Loyal to his investing principles, Burry didn’t have many positions in Scion’s equity portfolio after the comeback, with the first 13F filing from Scion Asset Management showing 14 holdings in companies like Apple Inc (NASDAQ:AAPL), Bank of America Corp (NYSE:BAC), and Theravance Biopharma Inc (NASDAQ:TBPH).

However, right out of the gate, Burry’s new fund started liquidating its positions. The last 13F filing that was disclosed by Scion Asset Management showed just four holdings. It held 550,000 shares of Coty Inc (NYSE:COTY), 15,000 shares of Alphabet Inc (NASDAQ:GOOG), 100,000 shares of HCA Healthcare Inc (NYSE:HCA), and 300,000 shares of Hostess Brands, Inc. (NASDAQ:TWNK), with Coty Inc (NYSE:COTY) and Hostess Brands, Inc. (NASDAQ:TWNK) representing new positions initiated during the third quarter of 2016. The fact that Scion Asset Management started to reduce its exposure to stocks sounded some alarms in the media that Burry might be seeing another market crash.

Another investment of Michael Burry is water. The last line of “The Big Short” movie reads: “Michael Burry is focusing all of his trading on one commodity: Water.” In a 2010 interview with the New York Magazine, Burry explained that he had been looking at investments in water for a long time, but instead of buying water rights, he chose to invest in food. He believes that a sustainable way to redistribute water is through growing food in water-rich areas and transport it to water-poor areas. In an interview with Bloomberg conducted the same year, Burry said that had been buying agricultural land with water on site, which he believes will be valuable in the future. Other reports said that Burry was in fact buying almond farms with irrigation in California, because almonds are the most water-consuming products, which require one gallon of water per almond. This makes sense now, because California has been struck by serious droughts lately and the state is responsible for around 80% of the world’s almond supply. Now, Michael Burry can capitalize on his investment, as his farmland that has the best access to water can benefit from the demand of almonds, while other farmers run out of water.