According to a report, hedge funds that had bet against Elon Musk’s Tesla after Donald Trump’s victory in the White House last week have lost billions of dollars.
Investment firms with short positions in the electric car maker’s stock took an on-paper hit of at least $5.2 billion between Election Day and Friday’s close, According to Bloomberg calculations Based on data compiled by S3 Partners.
Despite challenges such as tariffs, low consumer demand and an increasingly competitive industry for electric vehicle makers, a number of funds have bet against Tesla over the past four months, Bloomberg reports.
Most hedge funds with shorts on Tesla backed off their positions after Musk endorsed Trump on July 13, shortly after the first assassination attempt on the former president, according to Hazeltree data tracking more than 500 hedge funds obtained by Bloomberg. Started moving away.
Since Election Day, shares of Musk’s Tesla have increased by nearly 40% — or more than $200 billion in added market value.
Tesla’s valuation exceeds $1 trillion On Friday, hedge funds were prompted to reverse short bets on the company.
According to Hazeltree data obtained by Bloomberg, only 7% of hedge funds were net short in Tesla the day after the election — a far cry from the 17% decline in the stock in early July. Only 8% of hedge funds are net long Tesla.
Tesla shares have gained 39.2% so far this year, according to the performance of the CranShare Electric Vehicles and Future Mobility Index ETF, while the broader EV sector has gained 12% this year after falling 9% in 2023, Bloomberg reports. There has been a decline of more than %.
Tesla’s stock has also lagged other clean energy stocks, which fell on Trump’s victory.
According to Forbes, Musk – the world’s richest person with a net worth of $304 billion – emerged as perhaps Trump’s most prominent ally during the president-elect’s campaign.
He donated more than $100 million to pro-Trump PACs, rallying on Trump’s behalf and imploring Americans to vote early. $1 Million Daily Sweepstakes,
Tesla’s post-election success is due to Trump and Musk’s close relationship — the two were photographed awaiting election results together at the president-elect’s Mar-a-Lago residence — despite expectations that Trump would sell EVs. Will implement opposing policies.
“A Trump victory is very negative for Tesla as an auto company,” said Per LeCander, CEO of hedge fund manager Clean Energy Transition. In about 12 to 18 months, the Trump administration will eliminate “a lot of the subsidies that Tesla is actually winning on.”
The President-elect has committed to a pitch Musk will create a government efficiency commission – and allow the billionaire to take charge.
Last month, Musk said he would use his government position to eliminate regulatory hurdles in approving fully autonomous EVs – one of the main challenges facing his company.
Musk has already scored a big win over Trump’s upcoming return to the White House. His Net worth crosses $300 billion mark Tesla shares surged on Friday.
Tesla short sellers have been duped in the past – losing nearly $1.5 billion after Tesla posted surprise profits in 2019. According to reporting by The Post,
