- Speculators made a $15 billion profit this year betting on a decline in Tesla’s stock price, according to an analysis by S3 Partners.
- Elon Musk’s company value has plunged nearly 70% since its peak in November 2021.
- According to Musk, there is no connection between his involvement with chat platform Twitter and Tesla’s stock market decline.
- Read also: Elon Musk promises to stop selling Tesla shares for now
Speculators made a $15 billion profit this year by betting that the value of Tesla shares would fall. So it was: the electric car manufacturer saw about 800 billion dollars in value go up in smoke.
From an overview of data analytics firm S3 Partners shows that speculating on a drop in the value of the Tesla stock (in jargon: going short) has been very profitable.
According to S3 Partners, interest in the shorten by Tesla in April, when the stock actually started to drop sharply in value. As a result, entering new short positions has become less profitable. But interest spiked again in September as tech billionaire Elon Musk’s takeover of Twitter gained momentum.
Microsoft founder Bill Gates was reportedly one of the speculators who bet on Tesla’s declining value. Musk said earlier this year that Gates had taken a $2 billion short position against Tesla.
Tesla had a market cap of $1.24 trillion in November 2021. As of Friday, it had $385 billion left. The stock price was trading at $400 earlier this year and is now about 70% lower.
Musk’s personal wealth, which is heavily driven by his equity stake in Tesla, has shrunk by $132 billion this year, according to US data. Bloomberg Index of Billionaires.
Musk is no longer the richest person in the world but is now second behind Frenchman Bernard Arnault, CEO of luxury brand conglomerate LVMH.
Of course, Tesla has also suffered from a broader stock market crash, with the broad S&P 500 index tumbling about 20% this year, in part due to rising interest rates and the prospect of a economic slowdown.
According to Musk, there is no connection between the Twitter takeover, which he has devoted much attention to, and Tesla’s stock market decline. Some investors are complaining that Musk has paid too little attention to the electric car maker now that he’s the CEO of Twitter, as well as Tesla and aerospace firm SpaceX.
Musk points to rate hikes by the Federal Reserve which he says are making stocks in general, not just Tesla, less attractive.
Musk sold Tesla stock this year to fund a takeover of social media platform Twitter. On Thursday, Musk told him will not sell Tesla stock for the next 18 months.
