Elon Musk has responded to the news of an aggressive Tesla short seller’s decision to close his prolific fund. In a post on X, the social media platform formerly known as Twitter, Musk noted that he had warned short-sellers that betting against Tesla was a very risky affair.
As per recent reports, famed short-seller Jim Chanos, who has made a name for himself by betting against Enron, would be closing his fund. In a letter to investors of his fund, Kynikos Associates, Chanos noted that the bulk of the fund would be returned to investors by the end of the year.
“It is no secret that the long/short equity business model has come under pressure and interest in fundamental stock pickers has waned. While I am as passionate as ever about research and investing, I feel compelled to pursue these passions in a different construct,” Chanos wrote in his letter, which was viewed by the Financial Times.
Chanos took a well-publicized short position against Tesla. In the past, he has argued that the electric vehicle maker was a circus, and that the company was worthless. About two months ago, Chanos noted in an interview that his fund was still short Tesla, as he believed that the company was “ridiculously overvalued.” Needless to say, Chanos’ overall bet against Tesla was unsuccessful.
I did warn the shorts that this would happen …
— Elon Musk (@elonmusk) November 18, 2023
Amidst the news of Chanos’ decision to close his fund, Musk noted that he did warn short sellers about the risks of betting against Tesla. “I did warn the shorts that this would happen,” Musk wrote on X.
The closure of Chanos’ fund may be a notable win for Tesla, but the electric vehicle maker is still among the most shorted companies in the market today. Insider, citing data from HazelTree earlier this month, reported that Tesla was one of the most shorted large-cap stocks in the S&P 500 last month. Other notable large-cap companies that are shorted heavily include ExxonMobil and Apple.
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