Tesla up more than 130% half-year Analyst: Shorts enter desperate winter

Short Tesla investors are facing the “worst” period, with shares of the electric car maker’s shares rising sharply over the past seven months. Tesla shares closed up 0.38 percent at $405.59 on Friday, hitting an all-time high of $413 at one point, up 130 percent from the June 3 low of $178.97.

Tesla up more than 130% half-year Analyst: Shorts enter desperate winter

Tesla’s rally accelerated after it reported a surprise third-quarter profit and said its Shanghai Superplant and Model Y crossovers had earlier released their release dates. Ihor Dusaniwsky, managing director of forecast analytics at S3 Partners, wrote in a note that tesla’s surge in share prices had sent short sellers into a “winter of despair,” adding that investors who were bearish on Tesla had lost $2.43 billion so far this year.

Despite rising losses on market value, squeezing many short positions with low confidence or lower risk thresholds, “there are still a lot of shorts standing in their positions to cope with the roller-coaster market in 2019,” Dusaniwsky said. “If Tesla’s share price continues to rise, he expects the short-shot tobe bet will continue as more investors reach the risk limit.”

Tesla’s total of 25.46 million shares was shorted, just above the three-year low of 24.23 million hit on January 30, Dusaniwsky wrote. If the current short-back rate and share price rally continue, the number of short shares could fall below 20 million as Tesla’s share price hits $450.

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