Michael Burry, the investor best known for predicting the 2008 housing market collapse, has taken aim at some of Wall Street’s biggest AI winners, raising fresh questions for ETF investors heavily exposed to the trade. His latest regulatory filing revealed bearish positions against Nvidia Corp (NASDAQ:NVDA), Caterpillar, Inc. (NYSE:CAT), Tesla, Inc (NASDAQ:TSLA), and Applied Materials Inc (NASDAQ:AMAT), a basket that spans AI chips, semiconductor equipment, electric vehicles, and the physical infrastructure powering the artificial intelligence boom.
While Burry’s positions target individual companies, the implications extend well beyond single stocks. The four names feature prominently across some of the market’s most popular ETFs, from semiconductor and technology funds to industrial ETFs that have quietly become AI beneficiaries through the ongoing data center and chip manufacturing buildout. If Burry’s valuation concerns prove warranted, ETF investors may also feel the impact.
AI ETFs Have Nvidia at the Center
Nvidia remains the cornerstone of nearly every AI-focused ETF, making it the biggest common denominator in Burry’s bearish basket.
The VanEck Semiconductor ETF (NASDAQ:SMH) and the iShares Semiconductor ETF (NASDAQ:SOXX) both count Nvidia among their largest holdings, alongside Applied Materials, another stock Burry has bet against. While Nvidia has fueled much of the semiconductor sector’s rally over the past two years, Applied Materials has benefited from soaring demand for chip fabrication equipment as foundries race to expand AI capacity.
Broad technology funds are equally exposed. The Invesco QQQ Trust (NASDAQ:QQQ) has Nvidia and Tesla among its top holdings, while the Roundhill Magnificent Seven ETF (BATS:MAGS) includes Nvidia and Tesla as two of its seven constituents.
Caterpillar Brings Industrial ETFs Into the AI Conversation
Perhaps the most surprising name in Burry’s portfolio is Caterpillar.
Unlike Nvidia or Applied Materials, Caterpillar is not a technology company. Instead, investors have increasingly rewarded the heavy equipment maker as a key beneficiary of the AI infrastructure boom. Every new hyperscale data center, semiconductor fabrication plant, and power infrastructure project begins with excavation and construction, putting Caterpillar’s machinery at the heart of the AI supply chain.
That narrative has helped push Caterpillar to valuation multiples exceeding even Nvidia’s on a trailing earnings basis.
The stock is also a significant holding in industrial ETFs, including the Global X Dow 30 Covered Call ETF (NYSE:DJIA), State Street SPDR Dow Jones Industrial Average ETF Trust (NYSE:DIA), Industrial Select Sector SPDR Fund (NYSE:XLI) and the Vanguard Industrials ETF (NYSE:VIS), giving investors indirect exposure to the AI construction boom.
ETFs With Exposure to Burry’s Bearish Basket
| ETF | Nvidia | Applied Materials | Tesla | Caterpillar | Primary theme |
|---|---|---|---|---|---|
| VanEck Semiconductor ETF (SMH) | ✓ | ✓ | — | — | Semiconductors |
| iShares Semiconductor ETF (SOXX) | ✓ | ✓ | — | — | Semiconductor ecosystem |
| Invesco QQQ Trust (QQQ) | ✓ | ✓ | ✓ | — | Mega-cap technology |
| Roundhill Magnificent Seven ETF (MAGS) | ✓ | — | ✓ | — | Magnificent Seven |
| Industrial Select Sector SPDR Fund (XLI) | — | — | — | ✓ | Industrials |
| Vanguard Industrials ETF (VIS) | — | — | — | ✓ | Industrial sector |
Rather than signaling skepticism toward artificial intelligence, Burry’s latest positions appear to target the lofty valuations attached to companies benefiting from the AI investment cycle. For ETF investors, that means looking beyond semiconductor funds and recognizing that AI exposure now extends to industrials, infrastructure, and other sectors that have ridden the wave of data center and semiconductor investment.
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