George Soros bets on stocks drop

His huge bet paid off

It seems legendary hedge fund billionaire George Soros might be souring in his view on the market outlook for U.S. stocks, based on his most recent 13-F filing in the U.S., which showed a 605% increase in his short S&P 500 position (through put options on 11.29 million shares of SPDR S&P 500 ETF) to $2.2 billion.

In a 13-F filing three months ago, Soros’ fund had puts on 1.6 million shares, valued at $299.264 at the time.

Even though he is still net long stocks, this took the short position (where he owns an option which will profit from a fall in stocks prices) on the S&P 500 from 2.96% of his Soros Funds Management Portfolio to a whopping 16.65%.

Certainly it was offset to a small extent by an increase in the S&P 500 call position Soros has, which makes up 3.10% of his portfolio. But the large jump in in both the size and percentage of this put position suggests that Soros is getting worried about the market and where the S&P is going to head in the months ahead when the fed ends QE.

Where the S&P goes, so likely goes Australia’s ASX200 if Soros is right — so we’ve been warned.