Here's how much Tesla short sellers have lost since 2010

Tesla (TSLA) shares notched a nine-day winning streak after Monday's trading session, putting pressure on the stock's short sellers. S3 Partners managing director Ihor Dusaniwsky joins Catalysts to discuss Tesla's rally and how short sellers are being affected by the movement.

Dusaniwsky notes that Tesla short sellers have lost around $63 billion since the company's public debut in 2010. He explains that Tesla is "a really important name for a lot of hedge funds because this is the volatility that people are looking for in order to make a good profit."

He also casts some doubt on investors' bullish call on Tesla, explaining that the company is not just a fundamental trade: "This is a trade that's a little more technical market-driven because you've got a ton of long holders that are just Tesla forever, and really, it's what the market is doing rather than exactly what Tesla is doing."

Read more about Tesla's rally here:
Tesla looks to extend win streak to 9th day
Tesla stock rally continues as robotaxi reveal date nears
Tesla stock rises again, extending monster 40% rally over the last month

For more expert insight and the latest market action, click here to watch this full episode of Catalysts.

This post was written by Melanie Riehl

Video Transcript

We're going to turn our attention now to Tesla short sellers are feeling the brunt of the stocks recent rally.

A growing number of hedge funds had piled into short bets back in June.

And according to data provider, Hazel Tree, about 18% of the 500 hedge funds that the company tracks had a net short position on Tesla as of last month.

And that is the highest percentage in more than a year since the beginning of June.

Tesla's share price has now soared around 40%.

So bad news for those short sellers joining us now to discuss, we've got Ihor Duski S3 partners, managing director Ior, thank you so much for joining us.

You've spoken about this publicly before here.

So I want to get a number from you.

How much have Tesla short sellers lost since the stock made its public debut back in 2010 right now.

It's above $60 billion.

I think it hits around 63 billion as of right now.

So $63 billion is it just too expensive for anyone to be betting against this custom?

This company regardless of their fundamentals?

Well, short sellers, I've been up and down this name over the past couple of years, it was the number one short in the market now.

It's down to number four behind the video, Apple and Microsoft.

So there has been a little bit of uh you know, give and take in the name but uh short still, you know, this is like the OG short, everyone is still in it.

Yeah, you are.

That's what I wanted to ask you just how often do you see traders, investors shorting a name like Tesla?

When you take a look at this activity that we see now comparing that historically, is there anything really out of the ordinary?

It doesn't sound like it.

Well, we are seeing some short covering recently.

I mean there's been a little bit of a squeeze uh short covering going on and it's a, it's a really important name for a lot of a lot of hedge funds because this is the volatility that people are looking for in order to make a good profit, you know, in the name because you can get big bang for your buck.

So I I want to talk a little bit more about this because we have investors who come on and talk about the upcoming announcements that are going to come from Tesla and really continue to be bullish signals for the name moving forward.

I'm thinking about the continuous bullish sentiment around the Robo taxi, for example, to what extent are those investors betting on something that is likely to become a reality for this stock versus just kind of a pipe dream that Elon Musk is more than happy to continue to fuel.

Tesla's always had some, you know, manufacturing, uh you know, possibilities where they're, where they're growing their, their different type of cars, different type of uh services in their cars.

But really this name is, is not just a fundamental trade, this is a trade that's a little more technical market driven because you've got a ton of long holders that are just Tesla forever.

Uh And, and really, it's what the market is doing rather than exactly what Tesla is doing.