Elon Musk Sells Short Shorts 😂
Elon Musk’s Tesla short shorts are selling out for $69.420; a reference to the price Elon said he’d take Tesla private, and reference to some other things as well.
We can’t keep this guy out of our newsletter!
First came the swag. He helped finance the Boring Company’s Los Angeles Hyperloop with an ‘Initial Hat Offering’ of Boring Company caps in 2017. Then came the flamethrowers. There was no reason for those, but do you want a flamethrower?
Now, short shorts are being made-to-fit for Tesla bears, so far proven wrong in the market rally and down heavily as a result. This is stock market gloating on another level!
The majority of Tesla bears come from deep within Wall Street, the most prominent being billionaire, David Einhorn. It’s just so against the order of nature for a new auto brand to unseat current auto brands, given their economies of scale. But shorting a secular growth stock with a charismatic leader the whole world is rooting for? Einhorn should know better!
The Securities and Exchange Commission (SEC), or as Musk dubs it, the “Short-sellers Enrichment Commission,” can’t punish taunts, but some bears are complaining this short shorts fun is a sign of a market top. Other bears are in retreat. Most bears are suffering a backfire effect. Elon’s heckling only makes them believe that Tesla will fail even more!
The short-sellers have been on the end of an electric shock this year with shares soaring 189%. It’s actually worse than that, as shorting pre-sunk and volatile stocks comes at a greater cost than shorting ones that no one thinks will go down.
The broker charges you a fee to borrow the shares, and if Tesla were to pay a dividend, you wouldn’t get that as a short-seller either. You need real conviction in your bear bets. You want them to go down hard and fast!
I am not a financial advisor and my comments should never be taken as financial advice. Investments come with risk, so always do your research and analysis beforehand.
Originally published by Chris Morrissey at https://invstr.com on July 6, 2020.
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