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The "Big Short" investor laid his claim to fame through contrarian thinking

It's a well-known fact that Wall Street's major stock indexes have increased in value over the long run. Even though stock corrections, bear markets, and crashes are a normal and inevitable aspect of the investing cycle, the long-term growth of the American economy and corporate profits eventually lifts Wall Street's iconic indexes to new heights.

Nevertheless, there are opportunities for short-sellers to generate meaningful profits over shorter timelines. A short-seller makes money when the price of a security declines, and loses money when it rises. Whereas gains are capped at 100% for short-sellers (i.e., a publicly traded company's share price can't fall below $0), losses are, in theory, unlimited.

Burry gained notoriety for being in this contrarian camp during the financial crisis from 2007 through 2009. In fact, his story is documented in the 2015 film The Big Short, as well as the 2010 novel by Michael Lewis, The Big Short: Inside the Doomsday Machine.

Prior to the (in hindsight) collapse of the housing market, Burry questioned the health of mortgages that had been packaged into larger mortgage-backed securities (MBSs) by many of America's biggest financial institutions. With his fund (Scion), Burry purchased credit-default swaps on these MBSs and effectively bet on their default. When the dust cleared, Scion walked away with a profit totaling around $725 million.