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Short sellers threw in Tesla’s towel, with positions as a percentage of its total tradable shares falling to 3.3 percent, from 19.6 percent at the beginning of last year.
Short seller Carson Block, founder of Muddy Waters Capital, says he understands the reasons why people choose to bet against Tesla, arguing that they are “in principle not wrong” about the fundamentals that are not his trillion-dollar valuation not supported. “But the other side is [Tesla chief executive] Elon Musk, who’s better at playing the public company game than anyone I’ve ever seen. ”
Even with negative news over the past month – Musk promising
to sell 10 percent of its stock if its Twitter followers say so, Tesla is being sued for $ 162m by JPMorgan Chase over an alleged missed payment – the shares still rose about 30 percent, reports our markets team.
In today’s Big Read, Robin Wigglesworth looks at the wider footprint of what could be called the “Tesla financial complex”, which far exceeds the company’s market capitalization. This is due to a large, tangled web of dependent investment vehicles, corporate emulators and a huge related market for derivatives of unmatched breadth, depth and hyperactivity.
Combined, these factors mean that Tesla’s impact on the ebb and flow of the stock market is far greater than even its size would imply. It may even be historically unparalleled in its wider impact, some analysts say.
Driven by ordinary retail investors, the nominal trading value of Tesla options has averaged $ 241 billion a day in recent weeks, according to Goldman Sachs. That compares with $ 138 billion a day for Amazon, the second most active single-stock option market, and $ 112 billion a day for the rest of the S&P 500 index combined. Tesla has helped push U.S. option trading volumes above actual stock trading volumes this year.
Meanwhile, hedge funds that have shortened Tesla shares over the past decade are sitting on cumulative losses of more than $ 60 billion, according to S3 Partners, a financial analysis company. This year alone, the losses stood at $ 11 billion.
“Tesla shortening is just an ego trade at this point,” says Michael Green, chief strategist at Simplify Asset Management.
The internet of (five) things
Crypto-controversy over ‘Star Wars’, ‘Lord of the Rings’
Star Wars Stormtrooper helmets by artists including Sir Anish Kapoor and David Bailey were photographed and turned into non-fungal signs and marketed for millions of pounds without their permission, reported Cristina Criddle. Meanwhile, the estate of JRR Tolkien, author of The Lord of the Rings, has successfully overcome the JRR Token cryptocurrency which styled itself as “The One Token That Rules Them All”. In other crypto news, Binance CEO tells us that it is in talks with sovereign wealth funds about them taking a stake in the world’s largest cryptocurrency exchange. And Fidelity, UBS and State Street Global Advisors have confirmed they are looking to launch products that offer exposure to cryptocurrencies.
2. China intensifies celebs repression
The Cyberspace Administration of China has released a new set of rules to regulates celebrities, their ads and fan groups, as part of President Xi Jinping’s efforts to reform social values in the country. Madhumita Murgia kyk na methods to delay social media content and misinformation, with design tweaks such as limiting the size of groups or requiring users to copy and paste links, rather than clicking ‘share’.
3. EU must insist on transparency on social media ads
The EU will unveil draft legislation aimed at limiting the use of social media practices such as micro-targeting and user profiles by force technology groups to share information on how they distribute ads and target citizens online. Companies that break the rules will face a fine of up to 5 percent of turnover. Meanwhile, Italy’s antitrust authority fined Amazon and appeal $ 225m for alleged uncompetitive cooperation in the sale of Apple and Beats products.
4. Elizabeth Holmes describes Theranos mission to jurors
The founder of the start of blood analysis accused by US prosecutors of defrauding hundreds of millions of dollars from investors, position taken in her own criminal trial, and told jurors: “We thought it was a very big idea.”
5. Getir buys Weezy, greener ‘dark kitchens’
The Turkish app for fast delivery of groceries that Getir has acquired its competitor in the UK Weezy, as competitive company launch and increased competition forces consolidation in the market. Meanwhile, a boom in Europe’s “dark kitchens”, where takeaways are being prepared exclusively for sale on delivery applications, make the industry greener.
Technical tools – Fairphone 2 gets longer life
We’d like to highlight the latest devices in Tech Tools, but hats off to Fairphone, the modular mobile phone company, which is reviving the Fairphone 2, launched in 2015 with Android 5. As part of its mission to build ethically enduring smartphones, it has announced an upgrade to Android 10 will be available in the new year, giving “an unprecedented seven years of support” to the phone. Apple has not yet made hardware upgrades possible for its iPhones, but welcomes the FT editorial staff it makes them easier to recover.