Short sellers of SpaceX have accumulated approximately $5 billion in paper profits as the company’s stock has declined sharply since its blockbuster IPO, wiping out $1 trillion in market value, according to data from S3 Partners reported by livemint.com. Around 192 million SpaceX shares, representing about 30% of the total float, have been sold short.
S3 Partners, a financial markets data provider, noted that bearish investors increased their short positions significantly in recent weeks. Matthew Unterman, managing director at S3, told Business Insider that the notional value of short interest in SpaceX rose from $4.5 billion on June 15 to $25 billion. This indicates that investors betting against the stock are doubling down despite the company’s high profile.
The scale of short selling in SpaceX is notable given the company’s prominence and the hype around its IPO. The $1 trillion loss in market capitalization contrasts with the $5 billion in gains for short sellers, highlighting the volatility and investor skepticism surrounding the stock. This level of short interest is significant compared to typical market activity for large-cap companies.
The short interest data from S3 Partners was current as of mid-July, reflecting a rapid increase in bearish bets over the past month. This development underscores the challenges SpaceX faces in maintaining investor confidence following its public listing.