(Kitco News) - Despite its criticism of being an outdated relic, billionaires appear to be taking a new interest in gold.
According to updated regulatory filings, Michael Burry’s Scion Asset Management is now betting big on precious metals. In the first quarter, Burry bought 444,000 units of the Sprott Physical Gold Trust (PHYS), which is valued at more than $10 million.
Scion’s PHYS holding represents slightly more than 7% of total holdings.
Burry’s bet in the precious metal came as gold prices surged to record highs above $2,200 an ounce. Since the end of the quarter, gold has continued its unprecedented rally, pushing above $2,448 an ounce last month.
The 13F filing doesn’t show when Burry bought his stake in PHYS; however, the average price in the first quarter was around $2,130 an ounce. Gold prices are currently up more than 11% from that mid-point price.
Michael Burry gained fame in 2008 by accurately predicting the crash of the U.S. housing market. His wager against mortgage-backed securities was featured in Michael Lewis's book "The Big Short" and the subsequent Oscar-winning film with the same title.
While Burry is attracting attention for his gold investment, he isn’t the only hedge fund manager bullish on gold.
Last month, Billionaire investor Ray Dalio said that he holds some gold as a portfolio diversifier because it is the only form of “good money,” as fiat currencies are devalued by default or inflation risks.
David Einhorn, Founder of Greenlight Capital has been a long-time gold bull. SEC filing showed that in the fourth quarter of last year the hedge fund bought $74 million worth of shares in the world’s largest gold-backed ETF, SPDR Gold Shares (NYSE: GLD).
The latest filings show Greenlight took some profits in the first quarter as it reduced its position by 10%. The firm’s GLD holdings are still valued at nearly $74 million.
Along with gold, Burry’s firm is also increasing its bets on China. Scion increased its exposure to JD.com Inc. and Alibaba Group Holding Ltd. in the year's first three months.
The fund’s position in JD.com increased by 80% and is now valued at $9.9 million; at the same time, its stake in Alibaba increased by 67% and is now valued at $9 million.
