Michael Burry Is Short the iShares Semiconductor ETF. The Fund Has Still Gained 73% in 2026.
2026-07-22 19:21
•Todd Shriber •The Motley Fool
••••• •••• Axe Capital view
Why Michael Burry’s Semiconductor Short Looks Premature for SA Investors
Despite Burry’s bearish bet on semiconductors, the sector remains strong, with limited immediate impact on the JSE.
Michael Burry’s short on the iShares Semiconductor ETF (SOXX) highlights classic concerns: expensive valuations and the cyclical nature of chipmakers like Micron. Yet, the fund is still up 73% in 2026, fueled by AI-driven demand. For South African investors, this fight feels somewhat removed. The JSE doesn't list pure-play chip companies, and companies like Naspers or Prosus only get indirect exposure via global tech investments. Watch USD/ZAR: a sustained selloff in semiconductors could weaken tech-driven dollar inflows, potentially pushing the rand weaker. But AI’s role in boosting demand for high-performance components is a wild card that could derail cyclical norms. Given these uncertainties, I’m watching SOXX with interest but staying neutral locally until the semiconductor rout has clearer global impact or the rand reacts more decisively. this is just my opinion and not financial advice
Avoid jumping into semiconductor plays or related tech counters on the JSE for now. Focus instead on rand stability as a barometer; only consider local tech-related stocks if the sector correction deepens.
- USD/ZAR
- SOXX
- AI demand may sustain semiconductor earnings longer than expected
- rand volatility could increase on global tech selloff
6/10
Michael Burry, famous for predicting the 2008 financial crisis, has taken a short position against the iShares Semiconductor ETF (SOXX) and several of its major holdings including Nvidia and Micron Technology. Despite Burry's bearish stance and a recent 18.4% monthly decline, the ETF remains up 74% year-to-date. Burry cites valuation concerns and cyclical risks in memory chips, while critics argue his analysis doesn't account for AI's transformative role in the current semiconductor cycle.
This article was originally published by The Motley Fool and has been adapted here for Axe Capital Trading News.
Publisher: The Motley Fool
Author: Todd Shriber
Categories: Technology, AI, Semiconductors, Financials, Equities
Tickers: SOXX, NVDA, MU, AMD
Sentiment: Negative - Michael Burry has taken a short position citing rich 16x price-to-sales valuation and cyclical risks. The fund experienced an 18.4% decline over the past month, validating near-term bearish concerns. Burry is short this stock, claiming AI infrastructure companies use depreciation schedules (4-6 years) that exceed actual product usefulness (12-18 months), suggesting overvaluation. However, CEO Jensen Huang disputes this claim.
Keywords: semiconductor ETF, short position, valuation concerns, AI infrastructure, memory chips, market correction, chip stocks
Insights:
- SOXX: Negative: Michael Burry has taken a short position citing rich 16x price-to-sales valuation and cyclical risks. The fund experienced an 18.4% decline over the past month, validating near-term bearish concerns.
- NVDA: Negative: Burry is short this stock, claiming AI infrastructure companies use depreciation schedules (4-6 years) that exceed actual product usefulness (12-18 months), suggesting overvaluation. However, CEO Jensen Huang disputes this claim.
- MU: Negative: Burry highlights Micron's notoriously cyclical history and recent 25% decline into bear market territory. However, critics note AI-driven high-bandwidth memory demand may differ from past cycles.