13F: Michael Burry undertakes new strategies, hedging against the Chinese market.

Michael Burry, best known for predicting the subprime mortgage crisis, made several changes to his portfolio in the last quarter, including what appears to be a hedge against his significant bet on Chinese internet stocks. Burry, who currently manages the hedge fund Scion Asset Management, increased his stakes in several Chinese internet companies, according to a regulatory filing. The trader boosted his investment in Alibaba by 29%, bringing the value of his stake to over $21 million, making it his largest position at the end of September. The widely followed investor also doubled his position in JD.com, raising it to Scion’s second-largest holding, valued at $20 million. Burry also increased his stake in the Chinese search engine Baidu by 67%, bringing it to a value of $13.2 million at the end of the third quarter.

While increasing his ADR holdings, Burry made a significant number of put options against these companies, likely as a form of hedging. Investors profit from put options when the prices of the underlying securities fall. But when these options are combined with long positions, they can be used to offset potential short-term losses in the stocks. By the end of September, Burry held millions of dollars in put options against Alibaba, JD.com, and Baidu, with unknown strike prices, expiration dates, or values, according to the filing.

Chinese stocks received a boost in September after the government signaled a wave of stimulus measures in an attempt to revive growth and avoid continued stagnation in the world’s second-largest economy. However, many stocks lost some of these gains as authorities have yet to announce specific fiscal support. Burry became famous for betting against mortgage-backed securities before the global financial crisis of 2008. He was featured in Michael Lewis’ book “The Big Short” and the subsequent Oscar-winning film of the same name.

In addition to these Chinese companies, Burry increased his investments in payment processing company Shift4 Payments, American Coastal Insurance Corporation, and healthcare services firm Molina Healthcare. Fund managers with assets over $100 million are required to disclose their long positions to the U.S. Securities and Exchange Commission within 45 days after the end of the quarter. Active traders like Burry may have already altered their positions before the filings are made public.