Michael Burry

Burry is a pure fundamental analyst. He reads the actual documents.

Not the analyst summary. Not the ratings agency report.

The actual prospectus, the loan files, the footnotes. For the Big Short trade, he read thousands of individual mortgage loan documents.

Nobody else was doing that. Analysts were looking at aggregate statistics.

The aggregate statistics looked fine. The individual loans were a disaster.

His basic method: find something everyone is ignoring, do the work to understand why it''s mispriced, take a position, and wait. The waiting is the hard part.

He was short the housing market for two years before it collapsed. During those two years his investors were losing money on paper and threatening legal action.

He locked redemptions to prevent forced liquidation. He was right and it cost him two years of misery to prove it.

Peter Lynch

Lynch invented the phrase "tenbagger" — a stock that returns ten times your money. He was specifically looking for companies that could do that.

His method was deceptively simple: invest in what you know. Not what you know about macroeconomics or interest rates — what you know about everyday life.

What stores are you shopping at? What products are your kids obsessed with?

What new thing are you using that feels like it could be everywhere in five years? If you're noticing a company before Wall Street analysts have caught on, you have a real edge.

He categorized stocks into six types: slow growers (stable, boring), stalwarts (big companies, modest returns), fast growers (small and aggressive — where the tenbaggers live), cyclicals (tied to economic cycles), turnarounds (troubled companies that might recover), and asset plays (companies with hidden value the market hasn't priced in). His genius was applying rigorous fundamental analysis to companies most Wall Street analysts dismissed as too small or too mundane to bother with.

Michael Burry

Read the documents. That is basically the whole philosophy.

Not the summary. Not the analyst report.

The actual documents. Most investors don''t do this because it''s tedious and slow and it requires a tolerance for complexity that most people don''t want to develop.

His second rule: be willing to be lonely. His housing short was a deeply contrarian position that most finance professionals thought was ridiculous.

He didn''t need their validation. He needed the math to work.

His third: factor in time when sizing a position. The housing market stayed wrong for two years.

Size your position so you can survive being right too early.

Peter Lynch

He believed the average person has a real edge over professional fund managers — specifically the access to everyday life that analysts in offices don't have. You know which stores are packed on Saturday afternoon.

You know which new products your kids are obsessed with. Wall Street analysts often don't.

His most repeated principle: invest in what you know. His second: loving a company's product is not enough on its own — you still have to understand the fundamentals.

Third: stomach matters more than brain in investing. The biggest thing separating successful investors from unsuccessful ones isn't intelligence — it's the ability to stay calm when the market drops 20 percent and everything feels like it's ending.

Michael Burry

He concentrates heavily. When he has a thesis, he puts a large portion of the fund into it.

He also used leverage on the housing trade — borrowing to buy credit default swaps amplified both the wait and the eventual payoff. His risk tolerance is high in the sense that he can hold a losing position for years if the fundamental analysis is intact.

It is low in the sense that he won''t touch anything he doesn''t deeply understand. He doesn''t trade momentum or narratives.

If the math doesn''t work, he''s not interested.

Peter Lynch

Lynch ran a very diversified portfolio — sometimes over 1,000 positions — which cuts against the concentration gospel of Buffett and Munger. He justified it simply: if you find enough genuinely great small companies, you don't need to pick just one.

Some will fail. The tenbaggers more than compensate.

He wasn't reckless — he did detailed fundamental research on every holding. But he was comfortable owning things that looked messy or unfamiliar on the surface if the numbers told a better story.

His rule was that you should never own more companies than you can actually keep track of. He could track hundreds because researching them was his full-time job.

For everyone else the honest number is far smaller, and he said so.

Michael Burry

He lives in Saratoga, California. He is notoriously private — he has opened and deleted social media accounts multiple times after his market commentary attracted more attention than he wanted.

He occasionally posts about market risks and then goes quiet for months. He has a son with Asperger''s syndrome, and the experience led him to recognise similar traits in himself and pursue his own autism diagnosis as an adult.

He doesn''t do conferences. He doesn''t do interviews.

He files his quarterly 13F and lets the positions speak.

Peter Lynch

After retiring from Magellan in 1990, Lynch has spent most of his time on philanthropy. He and his wife Carolyn donated tens of millions to education through the Lynch Foundation, focusing on Catholic education and scholarship programs in Massachusetts.

He lives quietly for someone worth hundreds of millions. He speaks at Fidelity events occasionally, plays golf, and is generally not seeking attention.

He has said that the best decision he ever made was retiring at 46 — that no amount of money is worth missing your kids grow up.

Michael Burry

The housing trade. In 2005, Burry read thousands of subprime mortgage loan documents and concluded the US housing market was built on loans that would eventually default in large numbers.

He persuaded Goldman Sachs and Deutsche Bank to sell him credit default swaps on mortgage-backed securities — essentially insurance that paid out when the mortgages defaulted. The banks thought he was wrong.

They were happy to take his premiums. In 2007–2008 the mortgages defaulted.

His investors made $700 million. Burry personally made about $100 million.

The banks that sold him the swaps needed government bailouts to survive.

Peter Lynch

Fannie Mae. Lynch bought it heavily in the mid-1980s when almost nobody wanted it.

It was a housing finance company drowning in problem mortgages. Lynch dug into the fundamentals and decided the problems were fixable and the underlying business was genuinely valuable.

He was right. The stock went from roughly $2 to $40.

That single position generated hundreds of millions for the fund. His Chrysler bet was similar — he bought heavily when the company was a bankruptcy rumor and almost no one else would touch it.

Both worked because Lynch was willing to do the research on things everyone else had already decided were too ugly to look at.

Michael Burry

The trade nearly destroyed him before it paid off. He locked investor redemptions to prevent forced liquidation of his position — probably the right call, but it created a legal and emotional nightmare that he''s described as one of the worst periods of his life.

He also closed Scion to outside investors after winning, which in hindsight was leaving behind an institutional money management career after one of the greatest trades in history. He''s never explained that decision fully.

It may have been the right one. It may not have been.

Peter Lynch

Selling great companies too soon. He got into Walmart early and sold too soon.

He did the same with several other retailers that went on to become enormous. By his own account, his biggest mistake pattern was taking profits on genuine multi-decade compounders before they had compounded enough.

He also acknowledged that managing a $14 billion fund was fundamentally different from managing $18 million. The sheer size limited which companies he could meaningfully invest in — you can't move the needle on a $14 billion fund by buying a $50 million company.

He burned himself out keeping up with over a thousand positions. He retired at 46.

He's said he doesn't regret it.

Michael Burry

Michael Burry was born in San Jose, California in 1971. He lost his left eye to retinoblastoma as a child and has worn a prosthetic eye since.

He studied economics at UCLA and then went to Vanderbilt University School of Medicine. During his medical residency at Stanford, he posted detailed stock analysis on investor message boards between midnight and 3 AM.

The quality was consistently good enough that people in finance started paying attention.

He left his residency in 2000 — one year from finishing — to start Scion Capital with $1.1 million in loans from his family. No finance credentials.

Just a public track record and conviction. In his first full year, the S&P 500 fell 11.9%.

Scion returned 55%. From 2001 to 2008, Scion returned over 489% against the S&P 500's 3%.

Then he made the trade.

Peter Lynch

Peter Lynch grew up in Newton, Massachusetts. His father died when Lynch was 10, and his mother had to work to keep the family going.

Lynch caddied at the Brae Burn Country Club to help out. One of his regular clients was D.

George Sullivan, president of Fidelity Investments. Sullivan eventually offered Lynch a summer job at Fidelity — the kind of break you earn by showing up and doing the work.

Lynch studied history, psychology, and philosophy at Boston College — not finance — and said later that was probably an advantage. Too many finance students learn to look at spreadsheets and miss the obvious things happening in front of them.

He got an MBA from the Wharton School, joined Fidelity full-time in 1969, and took over the Magellan Fund in 1977. At the time, Magellan had $18 million in assets and was closed to new investors.

When Lynch retired at 46 in 1990, it had $14 billion and was the largest actively managed mutual fund in the world. He beat the S&P 500 in 11 of his 13 years managing it.

He's been a vice chairman at Fidelity in an advisory capacity ever since.

Michael Burry

Scion Capital ran from 2000 to 2008. He closed it to outside investors after the Big Short trade — partly because managing money for clients who were screaming at him to reverse a position he knew was right was a genuinely miserable experience, and partly because he didn't need to anymore.

He relaunched as Scion Asset Management, a personal vehicle he still runs today. His current investing is more conventional — value picks, occasional activist positions, portfolio bets that get attention when his 13F filings come out.

He bought GameStop before Reddit did. He shorted Tesla.

He has positioned in water rights and farmland. He tends to be early, which is both his gift and his problem.

Peter Lynch

His entire professional life ran through Fidelity Investments. He managed the Magellan Fund from 1977 to 1990 — 13 years of sustained outperformance that has never been matched at that scale.

His major holdings during that run included Fannie Mae, which he rode from $2 to $40. Chrysler, which he bought near bankruptcy.

And various retailers that nobody on Wall Street wanted to touch.

He was famous for finding companies in everyday life before analysts noticed them. He found Dunkin' Donuts because his wife liked the coffee.

He investigated L'eggs pantyhose after his wife bought them at a grocery store. He'd walk through a shopping mall and watch which stores were packed and which were empty — and then go home and read the financials to see if the story held up.

Michael Burry

BA in Economics, UCLA. MD, Vanderbilt University School of Medicine, 1999.

He completed three years of his medical residency at Stanford before leaving to start Scion Capital. He is technically a licensed physician who never practiced.

Peter Lynch

Boston College, class of 1965 — history, psychology, philosophy. Wharton School of Business, MBA.

He's on record saying studying history at Boston College was more useful for investing than anything he learned at Wharton. The historical pattern recognition, the ability to contextualize events — that showed up in how he thought about cycles and companies.