‘Big Short’ Investor Michael Burry Bails on Chinese Retail, Stays Put on AI

Best-known as the smartest man in the room when it came the housing market bubble almost 20 years ago, Michael Burry of The Big Short fame is making more surprising moves these days.

Having called housing’s top and making $1 billion off of it by shorting the industry, Burry may be signaling a market top in China. 

Last year he began building up positions in several leading Chinese stocks so that three of the biggest names accounted for 68% of his portfolio’s total. With $77 billion in assets under management in his Scion Asset Management hedge find, it was a big bet on the world’s second-largest economy.

However, that changed in the fourth quarter and he sold down his two biggest positions while standing on the third. It suggests he foresees big trouble brewing in China’s economy.

Alibaba (BABA)

After buying several tranches of stock in Alibaba (NYSE:BABA) last year, the Chinese e-commerce giant had grown to become Burry’s biggest holding representing 25% of the total. He owned 200,000 worth over $21 million.

Yet in the fourth quarter of 2024, the billionaire investor sold off a quarter of his stake, or 50,000 shares. While BABA stock is still Burry’s top position, it now only accounts for 16.4% of his portfolio.

It could mean the concerns analysts held about China’s slowing economy changed Burry’s tune on the business. Yet he seems to have missed out on locking in more profits. Although the stock really went nowhere in Q4, since the start of the new year BABA stock is up 52%. It had been even higher, up as much 70% until last week.

It tumbled sharply on Monday after President Trump announced new or expanded limits on exporting U.S. technology to China. It came just after Alibaba committed to spending upwards of $53 billion on artificial intelligence infrastructure investments. Because U.S. counterparts have encountered skepticism over similar big spending on AI, BABA stock is now coming under new scrutiny.

JD.com (JD)

Similarly positioned e-commerce stock JD.com (NASDAQ:JD) was the second stock Burry sold down in the fourth quarter. Where it had been his second-largest position behind Alibaba, or 24% of his portfolio, Burry sold off 40% of his position, or some 200,000 share of the 500,000 he owned. JD stock fell to his third-biggest holding representing 13.4% of the total.

Trump’s policies come as the president tries to level the playing field with U.S. trading partners who impose stiff levies against American goods coming into their countries. In addition to the technology curbs, Trump also wants restrictions on energy sales and in other strategic U.S. industries.

The president also called on Mexico to raise its tariffs on Chinese goods as companies move production to the country in an attempt to evade tariffs. Trump had temporarily halted tariffs on Mexico and Canada as part of an agreement to get them to stem the flow of drugs, like fentanyl, coming over the borders, but he announced those duties will be “going forward” beginning next month. More were to come.

Moreover, Trump promised to review accounting practices on Chinese companies listed on U.S. exchanges like JD.com. 

With so much uncertainty over trade issues between the two countries, Chinese stocks broadly fell. JD stock had been up 25% in 2025, but recently fell more than 7% after all the announcements came out.

Baidu (BIDU)

The one Chinese stock Burry held firm on was Baidu (NASDAQ:BIDU), the search giant that has since become a leader in AI, self-driving cars, mobile services, and more. 

The billionaire had built up his stake to 125,000 shares in the third quarter, but didn’t touch them in the fourth. They are worth $10.5 million and moved Baidu up to become Burry’s second-largest position representing 13.6% of Scion’s portfolio due to the sale of JD stock.

While its shares fell like the other Chinese stocks, BIDU stock is up 8% so far this year. Burry has an $101 per share average buy-in price on his holdings, meaning he is down 13% on his position.

Baidu announced on Tuesday it was expanding its empire even further, as it was buying Chinese live-streaming service JOYY for $2.1 billion. It had attempted to buy the business in 2020 for $3.6 billion, but the deal fell through. Chinese tech companies had come under intense regulatory scrutiny, which scuttled the acquisition last year, but Beijing relented in November, leading to the surge in tech businesses, including Alibaba.

Digital video is a fast-growing market and the JOYY purchase will allow Baidu to better compete against rivals, such as TikTok owner ByteDance. The move is seen as helping Baidu also further expand it AI and cloud investments

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