Michael Burry Flags Six Stocks as Tax-Loss Sale Candidates

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Summary · why it matters

Michael Burry outlined how he is positioning his portfolio for the fourth-quarter tax-loss harvesting season, highlighting six stocks that stand out as likely tax loss sale candidates that may not do well over the next couple of months. In his October 5th Substack post, Burry said the fourth quarter is tax loss harvesting season and that he tries to beat the rush, which arrives near the end of October and peaks in the first week of December. As part of a "proxy swap" trade, he established a new position in Deckers Outdoors while temporarily replacing his losing position in lululemon athletica with an undisclosed amount of Deckers Outdoors shares, retaining his long-term conviction in lululemon. He fully exited Fannie Mae and shifted the capital into Freddie Mac to capture the tax loss while maintaining sector exposure, planning to reverse the trade next month, and he is holding Fiserv through the volatility, saying its current valuation offers low-teens annualized return potential over the long term. In Sprouts Farmers Market and Zoetis, he replaced direct holdings with far-out-of-the-money LEAP calls expiring in 2028 and 2029 after both stocks hit new lows, while for MetLife he added long-dated 2029 out-of-the-money put options, citing potential stress in private credit and private equity valuations. Separately, Burry established a sizable position in BYD following a price pullback and added far-out-of-the-money 2029 call options on JD.com, but is not adding fresh capital to Alibaba, citing concerns over recent equity issuances used to fund the company's AI infrastructure buildout.

Impact on assets 12

Consumer Discretionary▲
Deckers Outdoor Corporation
DECK
▲ PositiveCapitalrelevance

Burry established a new position in Deckers Outdoors, using it as a proxy swap to replace his losing lululemon stake.

Lululemon Athletica Inc.
LULU
± MixedCapitalrelevance

Burry temporarily replaced his losing lululemon position with Deckers shares but retained long-term conviction in lululemon.

Jd Com Inc
9618
▲ PositiveCapitalrelevance

Burry added far-out-of-the-money 2029 call options on JD.com, signaling a bullish bet on the stock.

Artificial Intelligence▼
Alibaba Group Holding Ltd
9988
▼ NegativeCapitalrelevance

Burry is not adding fresh capital to Alibaba, citing concerns over recent equity issuances used to fund its AI infrastructure buildout.

Financials▲
Digital Finance & Tokenization▲
Fiserv, Inc.
FISV
▲ PositiveCapitalrelevance

Burry is holding Fiserv through the volatility, saying its current valuation offers low-teens annualized return potential.

Aging Population▼
MetLife Inc
MET
▼ NegativeCapitalrelevance

Burry added long-dated 2029 out-of-the-money put options on MetLife, citing potential stress in private credit and private equity valuations.

Consumer Staples▲
Sprouts Farmers Market LLC
SFM
± MixedCapitalrelevance

Burry replaced direct Sprouts holdings with far-out-of-the-money LEAP calls after the stock hit new lows.

Health Care▲
Zoetis Inc
ZTS
± MixedCapitalrelevance

Burry replaced direct Zoetis holdings with far-out-of-the-money 2029 LEAP calls after the stock hit new lows, a portfolio-positioning move rather than a company development.

Others▲