Tesla (TSLA) Short Sellers Suffer $7.6B Losses in 30 Days as Stock Continues to Strengthen

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Tesla short sellers suffered $7.6 billion in losses in 30 days, according to S3 Partners. The manufacturer's shares continue to strengthen and have risen by 70% over the past 30 days, making it the least profitable short.

Investors betting against Tesla stock have already begun to take a beating in 2023 as the stock is up 110% from its January 6 low. Losses by short sellers betting against Tesla have risen to $7.6 billion over the past month, making it the least profitable short position for hedge funds, according to S3 Partners, reported Markets Insider.

The rapid month-to-month rise in Tesla shares has already taken away half of the profits that short sellers made last year by betting against the company. At the end of December, short sellers made a $15 billion profit in 2022, making Tesla the most profitable short of the year. However, the situation changed dramatically in early 2023.

Tesla reported strong financial and operating results for 2022. In addition, the decline in prices for Tesla vehicles around the world caused an increase in demand, which was positive news that stimulated faith in the company. Elon Musk confirmed the manufacturer's long-term growth target of 50% per year. In addition, Investor Day will be held on March 1, which will feature Master Plan 3 and the 3rd generation vehicle platform.

On the opposite side of the bearish Tesla trade among hedge funds are retail investors, according to recent data from Vanda Research.

“Tesla continues to draw unprecedented retail flows[...]we believe that retail traders are currently chasing momentum in the stock aiming to recoup 2022 losses,” Vanda wrote in a note last week.

© 2023, Eva Fox | Tesmanian. All rights reserved.

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Eva Fox holds zero shares of Tesla, Inc., and currently (at the time of this article's publishing) holds zero options or securities in Tesla Inc. and/or its affiliates.