Exploring Tesla Share Price vs Short Interest


On June 17, Kusk Tweeted "Shorts have about three weeks before their position explodes." Let's track short interest.

Share Price vs Short Interest (in Millions of Shares)

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Data Feeds From Nasdaq

Short interest data comes out twice monthly.

Musk's Tweet set off a controversy when on Tweeted "Am Considering taking Tesla private at $420. Funding secure."

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So here we are. The Tesla share price is $301.66. A year ago, the price closed at $355.90.

In that time frame shorts are 15% ahead but many were likely stopped out on Musk's Tweets.

Tesla Monthly Chart

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The winning strategy since June 2017 has been to sell strike $360 calls every month and let them go to zero. One could have simultaneously sold strike $260 puts and collected two premiums.

Given the volatility of Tesla that represents a huge amount of premiums collected each month.

Of course hindsight is 20-20.

Finally, blaming the shorts is a poor strategy. Great execution, not broken promises, is the way to take on the shorts.

Mike "Mish" Shedlock


Global Economics