The dangers of being on the wrong side of long term trading. Have yet to hear of a scalper losing 13.5 billion. Have heard of a scalper making millions.
Maybe they never made into the billion zone. Maybe planes that survived shouldn't be used as an example. I like the first sentence tho.
This is the description of the linked video in the Original Posting and of the thread of course: What Happened To The Tesla Short Sellers? Nov 15, 2021 By Casgains Academy at Youtube Video URL Description: The Tesla short-sellers were once a vocal group of investors backed by a variety of top-tier investors. We’re talking about billionaire investors Jim Chanos and David Einhorn and two of the investors featured in the Big Short. But after Tesla’s exponential rise from approximately $36 per share to over $1,200, the Tesla short-sellers seem to have disappeared. The years of chaos between the short sellers and Elon Musk was the longest and most unprofitable short in history. So what happened to the short-sellers and where are they today? The Tesla short-sellers are not just a group of unfortunate fund managers, but rather a group of powerful men that almost took down Tesla. Elon Musk’s battle against the Tesla short sellers is a personal fight. In Elon Musk’s own words, short-sellers are value destroyers and should be banned. With that being said, we have to talk about the most notorious short-seller of them all, which is David Einhorn. Einhorn first started shorting Tesla stock in 2016, where he called Musk a promotional CEO. David Einhorn’s assets under management, or AUM in short form, were over $15 billion at the start of 2016. That is obviously a large amount, and for a great reason. Einhorn had a phenomenal track record, as he had a history of generating above-average returns. Unbeknownst to Einhorn, the start of his Tesla short marked the end of his career. In 2019, Einhorn presented his brilliant idea at CNBC’s Sohn Conference: Tesla was going to fail. He thought Elon Musk was going to make a mistake, and made it clear from his slideshow of quotes from Musk. A few months after that, Einhorn accused Musk of “significant fraud.” Elon Musk had enough of it, and proceeded to fire back at Einhorn. Elon even went as far as to call him Mr. Unicorn. His letter said, “Dear Mr. Unicorn (fabulous name by the way), We read your Greenlight Capital Q3’19 Investor Letter, in which you make numerous false allegations against Tesla. It is understandable that you wish to save face with your investors, given the losses you suffered from Tesla’s successful third quarter, especially since you’ve had several down years in performance and a sharp drop in assets under management from $15 billion to $5 billion. You have our sympathies.” Musk further explained Tesla’s recent developments, and then offered a tour of Tesla’s facilities and short shorts. He then ended the letter by saying “Regards, Treelon Musk.” Following Tesla’s exponential rise, Einhorn admitted that his Tesla short position was his biggest loser in 2020. Tesla stock increased by roughly 8 times in value in 2020, and it clearly detrimentally harmed Einhorn’s fund. As if it couldn’t get worse, Tesla’s recent move upwards likely marks the end of Einhorn’s career. Einhorn’s assets under management have dropped all the way down to $1.5 billion in the latest SEC filing, and is likely much lower right now. Keep in mind that he started with $15 billion in 2016, so his current AUM is only 1/10th of what he started with when he first shorted Tesla. Another one of the most renowned short sellers of Tesla is a hedge fund manager named Jim Chanos. Chanos first gained traction when he shorted Enron, one of the biggest frauds in history. Following the 2008 recession, when almost everything crashed, Chanos was managing over $7 billion. Unfortunately for Chanos, his performance was incredibly lackluster in the following decade. In 2015, Chanos announced that he was shorting Tesla stock based on Tesla’s valuation. By 2018, Chanos only had $2 billion under management, which was significantly lower than his previous AUM of $7 billion. As the market continued to increase, Chanos’s fund kept on crashing. At the end of 2019, his fund only managed $932 million. Chanos previously made money ⅔ of his short positions, but now that percentage dropped to ⅓. Tesla’s exponential rise was the nail in the coffin for Chanos. In the middle of the pandemic, Chanos announced that he was still “maximum short” on Tesla. Tesla stock was down at the time, but we all know how that panned out at the end. Chanos’s bold claim did not end well. Tesla stock proceeded to rise by almost 5 times in value by the end of 2020.
This David Einhorn guy deserves it! They are not investors, but market manipulating fraudsters. I hate these types!
the securities market is designed to help companies raise capital to make investments and grow. Everything else is tolerated only because it makes it easier for companies to raise capital to make investments and grow. Short selling is allowed because it creates a more complete market which allows real investors to know there is liquidity if they change their mind about a company. This allows those investors to pay more for a stock which in turn allows a company to raise more capital to make investments and grow.
I remember in late September 2008, right after the collapse of Lehman Brothers, the SEC banned short selling on the Financials. So the government wanting longs to win forever is spot on, but it doesn't say much about the "Free Marketeers" of the Bush administration. I was holding the SKF (ProShares -2X Financials ETF) and it went down but eventually came back. I believe when the SEC ended the short selling ban the Financials were even lower so it didn't really help. This was the period when Chanos was on CNBC/Bloomberg endlessly pumping his shorts of the large banks especially Lehman. He was right in the end.
I think I know what you are saying, and I have only shorted a few times in my entire time trading. I also think making it a main trade for a fund or individual is really dumb when there are so many more long opportunities available. On the other hand, I saw the Lehman CFO on tv before the collapse and she was either lying or had no business being a CFO, as she couldn't answer basic questions. I though of shorting hard, or at least going in on puts, wish I had! The same with a whole lot of the mortgage companies that were handing out loans to anyone and everyone. The management and sales staff were getting rich pumping loans to people they knew damn well couldn't afford them. I kept asking myself who the hell all these rich people over paying by a lot in our neighborhood were, as well as everywhere else. I felt real comfortable the answer was they weren't and got sucked into the mania and easy loans. I especially had a strong feeling about the mortgage clown CNBC kept parading out in his perma tan, slick willy salesman. I forget which company that was, but they were obviously handing out the candy to anyone and everyone. I did puts in that one a couple times, made a little, but was to chicken to go all in, not knowing how long the stupid could last. I really have no problem with a short of dirtbag companies. I am not a fan of Tesla, but they have an actual product people buy, and they maybe a mania, but I wouldn't short them.
They are lousy traders. but they are counter-trend traders who trade against the flow/wood grain/herd. They watch too many videos of salmon swimming up the waterfall. I doubt they are manipulators. Manipulators target small-cap stocks. Even that, you need to have a very deep pocket and you need to have quite a few buddies with deep pockets too.