Michael Burry reveals 2 big stock bets after Nvidia selloff

This article first appeared on GuruFocus. Nvidia Corp. (NVDA, Financials) has caught the attention of investor Michael Burry following its recent share-price decline, although he remains reluctant to buy the chipmaker as a long-term investment. Warning! GuruFocus has detected 3 Warning Signs with NVDA. Is NVDA fairly valued? Test your thesis with our free DCF calculator.NVDA GF Value chart Burry, known for predicting the U.S. housing market collapse, said Nvidia could soon look like "a heck of a trade" to investors seeking a rebound. His comments followed a sharp selloff tied partly to scrutiny surrounding CEO Jensen Huang and allegations involving a Chinese businesswoman suspected of intelligence ties. Burry does not expect the controversy itself to cause lasting damage to Nvidia's business. His larger concern is competition. He believes Nvidia's advantage in AI processors could narrow over the next five years, particularly if regulators increase scrutiny of the company's chip exports and industry relationships. Rather than increasing his exposure to Nvidia, Burry has been adding to other investments. In a recent portfolio update, he identified MercadoLibre and Australian online furniture retailer Temple & Webster as his two largest holdings, each representing more than 10% of his portfolio. Burry said he recently purchased additional MercadoLibre shares twice at prices below $1,500 and would consider buying more after another substantial decline. He also increased positions in Adobe and JD.com and added long-dated call options on Sprouts Farmers Market. The contrasting approach shows Burry's preference for selected consumer and technology businesses over a long-term commitment to Nvidia at current valuations. The next catalyst for Nvidia is its scheduled Nov. 17 earnings report, which will provide an updated picture of AI chip demand and the company's financial outlook.