Burry Bets on DraftKings and Flutter Stocks

Key takeaways

Michael Burry has initiated long positions in both DraftKings (DKNG) and Flutter Entertainment (FLUT), owner of FanDuel.
Burry says he bought DraftKings shares in the low $26 range, at a time when other high-profile investors such as Cathie Wood have been reducing their exposure.
DraftKings and Flutter shares have fallen 36.3% and 61.2% respectively over the past year, with prediction market platforms like Kalshi and Polymarket widely blamed for the decline.
Burry believes prediction markets are exploiting a regulatory loophole that will eventually be closed, which he sees as limiting the long-term threat to established operators.
Flutter separately faced turbulence this year including the surprise departure of CEO Amy Howe in May and the announcement of several hundred layoffs in June.

Michael Burry Takes Long Positions in DraftKings and Flutter Entertainment

Michael Burry, the investor made famous by the 2015 film The Big Short — in which he was portrayed by Christian Bale — has disclosed fresh long positions in sports betting giants DraftKings and Flutter Entertainment, the parent company of FanDuel.

According to reporting by Casino.org, Burry initiated his DraftKings stake in the low $26 range. The timing is notable given that other prominent investors, including Cathie Wood, have recently been trimming their exposure to the same stock.

Steep Declines but Burry Sees Value

Shares in both companies have taken a battering over the past twelve months — Flutter is down 61.2% and DraftKings has shed 36.3%. A significant portion of that slide has been attributed to the rapid growth of prediction market platforms such as Kalshi and Polymarket, which have attracted heavy trading volumes, particularly around sports events.

Flutter has faced additional headwinds of its own, including the unexpected exit of chief executive Amy Howe in May and news of several hundred redundancies announced in June.

Despite all of this, Burry views DraftKings as a company in positive operational transition, and considers Flutter fundamentally sound despite its recent missteps.

The Prediction Market ‘Loophole’

Central to Burry’s thesis is his belief that prediction markets are currently operating in what he describes as a “loophole economy” — taking advantage of a loose regulatory framework that he expects will eventually be tightened by US authorities.

Both DraftKings and Flutter have already begun moving into the prediction market space through DraftKings Predictions and FanDuel Predicts respectively. But crucially, if regulators do clamp down, these firms can fall back on their well-established positions in online sports betting and iGaming — something pure-play prediction market operators like Kalshi cannot easily do.

Not Burry’s First Gaming Play

This is not Burry’s first venture into gaming equities. He held stakes in Las Vegas Sands and Wynn Resorts back in 2020, and his hedge fund Scion Asset Management carried a position in MGM Resorts International in 2023 — at one point representing more than 7% of the Scion portfolio.

For UK players keeping an eye on the wider gambling industry, shifts in US investor sentiment around major operators can signal longer-term trends in global iGaming. Stay up to date with the latest developments in our casino news section, or explore our guides for more on how the global betting landscape is evolving.

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