Tesla is poised to become the first company to have a $20 billion bet against it by short-sellers, according to data from financial analytics firm S3 partners. Recently, the value of Tesla shares that have been sold short hit $19.95 billion, S3 said. Tesla could also soon see a short squeeze, which could send stock prices higher, according to the report. Watch Tesla trade live on Markets Insider. Read more on Business Insider. Short-sellers are increasing their bets against Tesla as the automaker’s stock rallies to new highs. Tesla is poised to become the first company to have $20 billion in short interest, according to data from financial analytics firm S3 partners. Recently, the value of shares of Tesla that have been sold short climbed to $19.95 billion, S3 data show. Tesla has also maintained its position as the largest equity short in the domestic market, Ihor Dusaniwsky, managing director of predictive analytics at S3, wrote in a Thursday note. Both Tesla and Nikola, a competitor in the electric vehicle industry, are solid candidates for a short squeeze, according to Dusaniwsky. A short squeeze is when short-sellers are forced to close their positions because a stock’s price has gotten too high. If many short-sellers exit the trade at once, it can drive the share price even higher. Read more: The top-ranked stock-picker in small companies has returned 13 times more than his peers this year. He breaks down the 5 little-known stocks he’s using to bet on the 5G and work-from-home revolutions. Tesla could see a short squeeze due to the stock’s blistering rally — it’s up 233% so far this year. “If Tesla’s stock price continues to trend upward, we expect even more short covering as mark-to-market losses accumulate,” said Dusaniwsky. “Traders can expect a squeeze on their shoulder from their controllers to trim or close out their positions as their Tesla losses breach risk limits.” Nikola could face a short squeeze due to high borrowing fees, according to S3. Stock borrow fees to bet against the company have hit the 600% level on outstanding short positions, while new stock borrows have a fee between 850% and 950%. Join the conversation about this story » NOW WATCH: What it’s like inside North Korea’s controversial restaurant chain
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Tesla is close to becoming the first stock with a $20 billion short bet against it
