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Short sellers book $8.7B paper profit as SpaceX falls under IPO price
Ortex data shows about 49% of SpaceX’s free float is on loan, and Ortex estimates every $1 move in the stock is worth more than $300 million to short sellers.
Short sellers targeting SpaceX shares are reportedly sitting on about $8.7 billion in paper gains since the rockets to AI firm’s initial public offering last month, as the stock slipped below its $135 IPO price, according to data compiled by Ortex Technologies.
SpaceX shares have traded with sharp swings since listing, dropping below the IPO level for the first time Wednesday before recovering to close just above it, with short sellers continuing to add to bearish positions as the shares eased toward the offering price.
Ortex estimates that roughly 49% of SpaceX’s free float is now out on loan. Ortex co-founder Peter Hillerberg said the short sellers stayed in the trade rather than taking profits, and the bearish bets have ended up favorably as the stock fell.
The weakness in SpaceX shares also reflects investor concerns about debt-funded AI spending, Ortex said. With a sizable short position in place, Ortex estimates that each $1 move in the stock represents more than $300 million on the short side, raising the risk of further volatility.