Mark Spitznagel predicts 80% stock market crash, calls current plunge a ‘trap’
Mark Spitznagel is the founder of Universa Investments, a hedge fund that takes positions to benefit from rare, unpredictable, but highly impactful events.
Mark Spitznagel, a well-known investor, has said that yesterday's stock market decline may be a precursor to a larger event in the future.
Photo of hedge fund manager Mark Spitznagel, taken at Bloomberg TV studio Feb 7, 2018 (Wikimedia Commons)
Referring to the plunge as a “trap,” he said that he anticipates an “80% crash when this is over,” according to a MarketWatch report. “I just don’t think this is it,” he added.
Spitznagel is the founder and chief investment officer of Universa Investments, a hedge fund. Its investing strategy is to take positions that will benefit from rare, unpredictable, but highly impactful events.
Funds like Universa Investments are known as “Black Swan” funds, referring to a term used to describe unexpected events. It was originally popularized by scientist, author and former options trader Nassim Nicholas Taleb, who was also influential in this same strategy.
An example of the strategy's success would be it making investment returns of as much as 4,144% when markets crashed in from fears of the COVID pandemic, according to the report.
“This is another selloff to shake people out. This isn’t Armageddon," Spitznagel said. "That time will come as the bubble bursts. This is a most contrarian view right now. Promise.”
This comes after Spitznagel having been calling for a bigger crash, which he feels would be the worst since 1929.
He had previously warned investors in 2024 to not get caught off guard when the stock market turns for the worse and end up being the “sucker” who sells when the market is down and buys when it’s up.
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