Tesla being attacked from all sides by investors, 3 bearish trades

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In recent weeks, anyone with an active Internet connection has been exposed to a number of Sala Tesla titles.

As a result of the disappointing publication of the company's first quarter results, CEO Elon Musk called the question of an badyst "stupid". Months later, Musk insinuated that a journalist was complicit in the insider hit and could provide non-public information about Tesla. Then Musk blasted critics for his involvement in rescuing a Thai football team.

And this is only a sample of the public mishaps involving Musk. Beneath the surface of Tesla, the company burns cash at a breakneck pace, and has recently pushed back the delivery windows for two of the three versions of the Model 3.

All of these elements have combined to make Tesla a popular target for bearish investors of all types. And while the stock market has long been the preferred outlet for skeptics, they have recently added two more bearish stocks to their repertoire: bonds and credit default swaps.

With that established, here is a handy summary of the three favorite ships to bet against Tesla:

The Stock Market

Short sellers have a long-standing controversial relationship with Musk, who has taken the habit of taunting his stock market opponents. But his efforts have been largely in vain, as Tesla has remained the most shorted stock of the US stock market for most of the past 18 months.

The IHS Markit data suggest that short sellers continue to move forward, perhaps by positioning themselves in front of Tesla's second-quarter earnings report on Wednesday. They sold 350,000 fewer shares in the last week, bringing the total to 35.4 million, according to firm data.

Here is an overview of the fluctuation in the number of shares outstanding since the beginning of the year 2018. Note that even though the measure seems rather limited, Tesla has remained the shortest stock on the market American for a considerable period. .

IHS Markit

The bond market

Immediately after the initial issuance of Tesla's bond, expiring in 2025, credit companies seized the opportunity to use another way to bet against the company. In no time, 8% – or $ 140 million – of the total size of the issue were shorted. And that number has grown over time, currently sitting at 14%, or $ 264 million.

And while the short-circuited amount in the bond market is derisory compared to what happens in equities, IHS Markit suggests that overdraft bonds have greater symbolic significance.

"The negative sentiment about the company's more than $ 8 billion debt seems to be accelerating, and bond market signals are often viewed as having greater significance as a result. it is mainly composed of institutional investors, "said Sam Pierson. Director of Title Finance at IHS Markit, wrote in a customer note.

IHS Markit

Credit default swaps

Tesla's credit-default swaps (CDS) have only been available since the end of June, and they have already seen interest (as evidenced by the recent spike of the purple line below).

For context, the axis of the straight lines on the chart below represents the number of points offered in advance. In more relatable terms, 18% (where CDS began trading) translates into $ 180,000 paid in advance – plus another $ 10,000 a year – to insure $ 1 million worth of Tesla bonds .

While the CDS advance points have declined slightly from a peak observed in the second week of July, the trajectory appears to be on an upward trajectory.

It is clear that more capital is needed to process Tesla CDS, so that it will never be as popular as the stock market when it comes to bearish bets. But the fact that such a market exists and thrives shows just how much anti-Tesla products are in demand.

IHS Markit