Tesla’s Rally Costs Short Sellers $5.5 Billion in Four Days: S3 Partners Report

In the four sessions following Tesla’s announcement of more affordable cars, and FSD roll out in China, investors who bet against the stock have collectively lost $5.5 billion, according to S3 Partners’ data.

Since the April 24 announcement, Tesla’s stock has surged almost 40%, including a nearly 16% jump on Monday. This increase came as the company overcame regulatory hurdles for its self-driving software in China.

Monday’s surge resulted in short sellers losing $2.93 billion, making April unprofitable overall with losses of $2.11 billion.

Despite the recent rally, Tesla’s shares are still down nearly 20% for 2024. However, bearish investors have still managed to book profits of $4.10 billion so far this year.

Contrary to a short squeeze, short selling into the rally has been observed, with over 2 million new shares shorted in the last week, according to S3’s head of predictive analytics, Ihor Dusaniwsky.

Tesla ranks as the third-largest U.S. short, following Nvidia and Microsoft. Approximately $18.53 billion, or 3.97% of its publicly available shares, are in short position.


The Tesla’s first-quarter sales in California saw a 7.8% decline, according to a report from a car dealer group.


Tesla $TSLA experienced a remarkable surge today, with a gain of 15.31%, marking its most significant single-day increase since March 2021. Notably, this surge coincided with the highest trading volume seen in almost a year.

Over the past week, Elon Musk’s net worth has surged by $37.3 billion, reaching a total of $201.5 billion. This surge represents Musk’s largest weekly gain since March 2022.

This rally was fueled by reports confirming Tesla’s receipt of in-principle approval from Chinese authorities to introduce its Full Self-Driving (FSD) software in China. The partnership with Baidu ($BIDU) to utilize its mapping and navigation capabilities further buoyed investor optimism.

Additionally, during Tesla’s earnings report last week, it was revealed that the company intends to unveil a more affordable vehicle as early as this year, contributing to positive market sentiment.

As a result of this rally, short sellers have incurred significant losses, totaling $5.5 billion over the past four trading days.

Despite its recent surge, Tesla’s stock remains down by 22% year-to-date, though it has substantially improved from its position last week when it was the worst performer in the S&P 500, with a drop of over 42%.


As of Tuesday morning, Rebecca Tinucci, Senior Director of Tesla’s Supercharger business, and Daniel Ho, director of vehicle programs & new product initiatives, will depart from Tesla, along with nearly 500 employees from the Supercharger team.

Elon Musk conveyed in an email that these measures are intended to emphasize the necessity for rigorous control over headcount and cost reduction.

Musk expressed disappointment that not all members of the executive staff are fully committed to these measures at present.

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