Bears got severely burned with Tesla shares up 730 per cent this year
With shares up 730 per cent, Tesla bears have seen more than $38 billion in mark-to-market losses this year, according to data from S3 Partners. By comparison, the next-biggest loss for short sellers was on Apple Inc., at just under US$7 billion, S3 data shows.
This “is not only the largest mark-to-market loss for any stock this year, it is the largest yearly mark-to-market loss I have ever seen,” said Ihor Dusaniwsky, a managing director at S3 Partners.
Tesla didn’t respond to a request for comment.
For now, the electric carmaker and its investors, small and large, have the upper hand against a group of short sellers that have come to be known as TSLAQ — Q being the character exchanges tack onto a stock ticker after a company files for bankruptcy.
Many of Tesla’s short sellers have closed out their positions over the course of 2020, with short interest falling to 6 per cent of the float from nearly 20 per cent a year ago, according to S3 data.
Tesla’s shares soared this year as it notched five consecutive quarters of profits and amid growing sentiment on Wall Street that the shift toward electric vehicles is accelerating. The company was added to the S&P 500 Index on Dec. 21 and several smaller EV stocks have rallied along with it.
The next potential catalyst comes in early January, when Tesla reports fourth-quarter vehicle production and delivery figures. Tesla expects to deliver half a million cars in 2020, a huge milestone for a company that initially struggled to mass-produce its Model 3 and is now building additional factories in Berlin and Austin, Texas.
In July, Chief Executive Officer Musk tweaked the noses of Tesla critics by selling limited-edition red-satin shorts with the company’s logo — or what he called “short shorts.” Fans have posted pictures of themselves wearing them as Tesla’s stock has rallied, and Musk tweeted a picture of a pair as a Christmas greeting.
Musk, who with an 18 per cent stake is Tesla’s largest shareholder, has seen his own wealth balloon this year. He’s now the second-richest person on the planet after Jeff Bezos of Amazon.com Inc.
Source: Financial Post
Image Source: Tesla
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