Trading & Options · Profile from Trading and Options Research Companion
Scion Capital (Michael Burry)
The California hedge fund founded in November 2000 by Michael Burry — a physician turned value investor who had built a following on internet message boards — which became the first well-known fund to buy credit default swap (CDS) protection on subprime mortgage bonds, starting with $60m from Deutsche Bank on 19 May 2005 (Michael Lewis, as cited by Wikipedia). The trade lost money and provoked an investor revolt for almost two years — a side pocket locked up about half of investors' money (Lewis, secondary) and the fund lost ~18% in 2006 (secondary table) — before paying off in 2007, when Scion reportedly returned ~138% net and made ~$725m for investors and ~$100m for Burry (Lewis, Vanity Fair, Apr 2010, via Wikipedia). The record from 1 Nov 2000 to June 2008 is reported at +489% net of fees against ~2% for the S&P 500 (same source); all of it is unaudited letter-based reporting (rule 4(c)). Burry closed Scion Capital in 2008, reopened as Scion Asset Management (2013), and became better known for his 13F filings — GameStop (2019–20), index puts (2023), Palantir and Nvidia puts (2025) — than for his returns, before Scion's SEC registration was terminated in November 2025. Its story turns on the hardest problem for any convex short: being early is indistinguishable from being wrong — for a while.
At a glance
- Founded
- Nov 2000 (inception 1 Nov 2000), San Jose area, California, funded by an inheritance and family loans; Joel Greenblatt's Gotham Capital an early investor (Wikipedia, citing Lewis)
- Founder
- Michael J. Burry (born 19 Jun 1971, San Jose); lost his left eye to retinoblastoma at age 2; MD, Vanderbilt (1997); partial neurology and pathology residencies at Stanford; wrote about value investing on Silicon Investor boards from 1996 (Wikipedia, citing Lewis, Zuckerman and others)
- Headquarters
- Cupertino / Saratoga, California (Burry lives in Saratoga — Wikipedia; office location from memory, verify)
- Ownership / structure
- Private; Scion Capital (2000–08) — master and feeder funds (names from memory, verify); Scion Asset Management, LLC (CIK 0001649339), registered adviser filing 13Fs in 2016 and 2019–25; registration terminated effective 10 Nov 2025 (SEC records, as reported by Bloomberg and Reuters)
- Scale (dated, reported)
- ~$600m at end-2004, after which Scion turned away new money (Lewis via Wikipedia); ~$1bn at its height (secondary); Scion Asset Management $154.93m (Mar 2025, Form ADV as reported) and $155m (2024, Wikipedia infobox); 13F long-and-option values $1.74bn (30 Jun 2023) and $1.38bn (30 Sep 2025) — mostly option notional, not capital (EDGAR)
- Signature record (rule 4(c) — unaudited)
- 2001 +55.4% gross / +44.7% net vs S&P 500 −11.9%; 2002 +16.1% / +13.1% vs −22.1%; 2003 +50.7% / +40.8% vs +28.7%; 2004 +10.8% / +8.9% vs +10.9%; 2005 +7.8% / +6.5%; 2006 −18.2%; 2007 +166.9% gross / +138.3% net; Q1 2008 +3.1% net (hedgefundalpha table, unsourced — secondary; chains to ~+472% net); +489.34% net from 1 Nov 2000 to Jun 2008 vs just over 2% for the S&P 500 (Lewis via Wikipedia — a different basis from the table)
- Regulators
- SEC (Scion Asset Management as registered adviser; 13F, 13D filings); no enforcement action found
- Signature moves (incl. failures)
- Founding Scion and the value record (2000–04); buying subprime CDS (2005); the side pocket and investor revolt (2006–07); the payoff and closing Scion Capital (2007–08); the GameStop stake and board letters (2019–20); index puts (2023); Palantir and Nvidia puts and deregistration (2025)
7 strategic moves analysed
Each one gets a full strategy file in the companion: context, the decision, the financing, what happened, and the lesson.
2000
Founding Scion and the Value Record
Founding or fund launch
2005
Buying CDS on Subprime Mortgage Bonds
Large trade or position / new strategy
2006
Side Pocket and Investor Revolt
Liquidity, gating or investor-terms decision / loss and drawdown response
2008
Payout and Closing Scion Capital
Large position pays off / closing a fund
2019
GameStop Stake and Board Letters
Large trade or position / activism
2023
Index Puts and the 13F Signal Problem
Large trade or position (hedge or directional bet)
2025
Palantir Nvidia Puts and Deregistration
Large trade or position / closing a fund or strategy (end of outside-money business)