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Liam Denning

Michael Burry Isn't Early With Tesla ‘Big Short,’ Just Lonely

Unlike his famous wager against the housing market, Michael Burry’s bearish bet on Tesla isn’t early. But it’s just as uncrowded.

For bulls, Tesla's giant valuation symbolizes Elon Musk’s inevitable victory. For the likes of Michael Burry, it’s a giant bull’s eye.

For bulls, Tesla's giant valuation symbolizes Elon Musk’s inevitable victory. For the likes of Michael Burry, it’s a giant bull’s eye.

Photographer: Tony Avelar/Bloomberg

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The most notable aspect of Michael Burry’s outing as a short seller of Tesla Inc. is that he is Michael Burry “of ‘Big-Short’ fame.” The second-most notable aspect is that he has entered a trade that, like much else in 2020, emptied out all of a sudden.

This isn’t just a function of Tesla’s trading volume surging along with its price either. Last year’s roughly eightfold increase in the stock put Tesla’s bears in a bear hug, with even longtime skeptic Jim Chanos reducing the size of his trade. Whereas two years ago roughly a third of Tesla’s free float was held short, only 5% was at the end of April, an all-time low.