Short sellers who bet against Tesla’s (TSLA) stock have lost $7 billion U.S. as the electric vehicle maker’s share price has risen 42% in the week since Donald Trump won the presidency.
Tesla’s stock rose another 9% on Nov. 11 to finish trading at $350 U.S. per share, its highest level in two years.
The rally is hurting short sellers who bet against Tesla’s stock in recent months and in the run-up to the U.S. presidential election on Nov. 5.
Tesla chief executive officer (CEO) Elon Musk was one of Trump’s biggest supporters and financial donors during the election campaign.
The stock of Tesla is one of the biggest winners of the post-election rally, which has pushed the company’s market capitalization above $1 trillion U.S.
Tesla’s stock is one of the most shorted on Wall Street. Slowing vehicle sales, inconsistent financial results, and delayed product launches have led many traders to bet against Tesla.
Until the U.S. election, Tesla’s shares had been flat this year, with all their gains in 2024 coming in recent days.
About 3% of Tesla shares available for trading are sold short. That’s significantly higher than the 1% short-interest ratio for most large-cap technology stocks.
The high short interest in Tesla stock has led to short-seller losses of about $7 billion U.S. since the election a week ago.
The pain for short sellers may worsen as many analysts expect Tesla’s stock to hit new all-time highs in coming weeks.
Tesla’s stock is now up 40% on the year.