Michael Burry Eyeing Short Against SpaceX but Balks at Cost
The 'Big Short' investor sees SpaceX as overvalued but won't pay the options premium. Here's what that signals.
Michael Burry — the man who shorted the entire U.S. housing market and won — is looking at SpaceX and smelling a trade. The problem? The options are too expensive, and even Burry won't pull the trigger when the price isn't right. That discipline is worth noting.
Burry's core argument is straightforward: SpaceX's market cap has ballooned to levels that dwarf many well-established companies and generational fortunes. In other words, the valuation has sprinted so far ahead of reality that it's starting to look a lot like the kind of setup he made famous in 2008.
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But here's the tradeable lesson — Burry is passing. When the cost of being right exceeds the potential payoff, even the sharpest bears sit on their hands. Options on private or hard-to-access names carry massive implied volatility premiums, and bleeding theta while waiting for a correction is a account-killer strategy for most retail traders.
The broader signal is what matters here. A legendary short-seller sees enough red flags to be tempted, but the market has already priced in significant skepticism through those elevated option premiums. That's the market telling you the bear case is not a secret. When everyone knows the setup, the setup rarely pays clean.
If you're a retail trader watching this, don't try to out-Burry Burry. He invented the playbook and he's still not taking the trade. Watch the valuation argument, track any future liquidity events or public market moves involving SpaceX, and keep your powder dry. Continue reading at US Top News and Analysis.
