Short sellers have a new nightmare, as Tesla mulls going private
New York — It would be the ultimate black eye for short sellers. A buyout of electric carmaker Tesla, led by entrepreneur CEO Elon Musk, would cap a painful ride for short sellers, who have amassed more than $13bn in bets that the company will founder and deliver them a huge windfall. Instead, Tesla’s stock has surged more than 900% in five years, and this year alone losses have now topped $3bn. Short sellers have had a painful year as stock prices have risen broadly, leaving fewer opportunities for profits as heavily shorted stocks have risen also. Just 69 out of the 500 companies in the benchmark US S&P 500 stock index have declined by 10% or more for the year to date, while 164 companies have gained more than 10% over the same time, according to a Reuters analysis. "I’ve got guys pitching me all the time on short ideas and I love to hear them, but in this environment I’ve been burned too many times and I’m gun shy about shorting anything that has any viability," says Mark Spiegel...
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