Key Words: ‘Big Short’ investor who cashed in on the financial crisis explains how he’s profiting from coronavirus ‘stampede’

That’s Michael Burry, of “The Big Short” fame, explaining to Bloomberg News why he plans on sticking to his “significant” bearish bet during this nasty market downturn.

Burry, the doctor-turned-investor who made a killing betting against the housing sector in the lead-up to the 2008 financial crisis, said the coronavirus outbreak is delivering a “potential trigger for the unwinding of the passive investing bubble.”

At last check, the Dow Jones Industrial Average

DJIA, -5.85%

was off its lows of the session, but still down more than 1,400 points in the latest selloff. Both the Nasdaq Composite

COMP, -5.52%

and the S&P 500

SPX, -5.69%

were almost 6% lower.

“No one knows how long it will last, and so people have a valid reason to sell,” Burry told Bloomberg. “If you are in stocks because they have been going up and because the central banks always could apply the brakes to any sell-off, well, the those pre-conditions are not currently valid.”

Read: There’s a bubble in passive investing, says Michael Burry

So, he’s in no hurry to close out his bearish bet.

“I would say despite the viciousness of the sell-off, there has not been enough time for the buy-the-dip mentality to truly go away,” he said. “But the fear in the markets is being paralleled by growing fear of the virus, and the twofer is toxic to market sentiment.”

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