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There are the giddy “Teslanaires” who understandably will talk your ear off about how amazingly well they’ve done over this year, and then there’s the other, much darker, side of the trade.
Those betting against Elon Musk.
According to S3 Partners, short sellers lost more on Tesla TSLA, +1.99% than they did on any other company. And it’s not remotely close. We’re talking billions and billions more.
This “is not only the largest mark-to-market loss for any stock this year,” S3 managing director Ihor Dusaniwsky told Bloomberg News, but “the largest yearly mark-to-market loss I have ever seen.”
In total, Tesla bears racked up in excess of $38 billion in mark-to-market losses as the stock exploded for a gain of more than 700% this year. The next biggest money loser for the short shellers? Apple AAPL, -0.58% at almost $7 billion, S3 reported.
And Musk is clearly relishing every minute, with taunts like this:
Amid the carnage, there are a lot fewer Tesla shorts these days, with short interest dropping to 6% of the float from 20% a year ago. Kynikos Associates founder, Jim Chanos, for instance, revealed to Bloomberg earlier this month that betting against the stock has been “painful” and that he reduced the size of his short position in his hedge fund.
“The short squeeze has been going on all year. It’s been an angled straight line down,” S3’d Dusaniwsky explained to Bloomberg. “The big thing about Tesla as opposed to any other stock is that the vast majority of retail shareholders will never be sellers. They love the stock, they love the car, they love Elon Musk and they are adamant long shareholders.”
Tesla shares are on track to end the year with an uptick, edging 1% upward early in Thursday’s shortened trading session, while the Dow Jones Industrial Average DJIA, -0.10% and S&P 500 SPX, +0.02% also inched higher and the Nasdaq Composite COMP, -0.05% was off slightly.
