Short-sellers lose $15 billion to Tesla while shares in Elon Musk’s firm sink 70%

As Tesla shares continue to slide, Elon Musk is no longer considered the world’s wealthiest person.
According to S3 Partners, $15 billion was made by investors betting that Tesla shares would plummet this year. Musk has not been able to link Tesla’s decline with his takeover at Twitter.

New research shows that short-sellers bet $15 billion on Tesla shares falling. This was after the company’s value fell to $800 billion.

S3 Partners analysis showed that bets against Tesla shares were the most profitable in 2022. Shorts against Amazon shares made a $6.2 billion return.

S3 reported that interest in betting on Tesla began to decline in April, as the stock started declining. However, it increased again in September, as Elon Musk’s bitter acquisition of Twitter reached its final stages.

Tesla shares are being shorted at a third of their value, making them the second-largest US short seller after Apple.

Bill Gates, the Microsoft founder, is one of the people who are betting against Tesla. Musk claimed earlier this year that he had a shortfall of up to $2B against Tesla.

Tesla’s value fell by over $800 billion in this year. At its peak, in November 2021 the company was valued at $1.24 trillion. However, shares closed Friday at $123, making it worth $385 billion. The stock was at its lowest point in the year, around $400.

Musk’s ownership in Tesla has resulted in a $132 billion drop in his wealth, according to the Bloomberg Billionaires Index. He is now second only to Bernard Arnault as the world’s most wealthy person.

Tesla is not immune to the wider market selloff, which has been accompanied by high inflation and rising interest rate. This has led to the S&P 500 falling by almost a fifth this fiscal year.

Musk has refused to make a connection between his Twitter work and Tesla’s decline, despite several prominent investors asking him to return to Tesla.

Instead, he blamed the Federal Reserve for its interest rate hikes that he claims make all stocks less appealing to own — not just Tesla’s.

While he aims to make Twitter a success, the CEO of Twitter has already sold Tesla shares worth $3.6 billion this year in order to finance operations.

Musk stated that he would not sell more Tesla stock until at least 18 months.

Business Insider has the original article.
—————————————————————————————————————————————
By: rhogg@insider.com (Ryan Hogg)
Title: Short-sellers make $15 billion betting against Tesla as shares in Elon Musk’s company sink by 70% this year
Sourced From: www.businessinsider.com/short-sellers-made-15-billion-betting-against-tesla-shares-2022-12
Published Date: Sun, 25 Dec 2022 08:44:36 +0000