The investor said he built a position weighted roughly 60% in Flutter and 40% in DraftKings, arguing prediction markets face eventual regulation and taxation.
Michael Burry said he bought shares of sports-betting operators DraftKings and Flutter Entertainment, wagering that pressure from prediction markets has overly depressed the stocks and that regulators will eventually move to close what he called a loophole. In a Wednesday post on his website, he said the investments together make up a full-sized position weighted roughly 60% to Flutter and 40% to DraftKings, with Flutter bought at about $107 a share and DraftKings in the low $26s, and with scope to make each a full position later. Burry said prediction markets are the main threat facing the companies because event contracts can be offered nationwide under Commodity Futures Trading Commission oversight while avoiding state gaming taxes. He argued the political climate is unlikely to tolerate that model indefinitely and said he expects prediction markets to eventually be brought under regulation and taxation. He described Flutter, whose shares were down 50% this year as of the last close, as a strong business with significant scale despite past capital misallocation, and said DraftKings, down 21%, is inflecting as an operating business. Burry also said he bought more JD.com shares at $27.58, calling the stock one of his top three positions, and expects Hong Kong and Chinese stocks to benefit as AI and memory-chip enthusiasm unwinds in South Korea and Japan.