As the US stock market rebounded, Wall Street's most famous bear surrendered nearly 40 years after founding his hedge fund.
According to media reports recently, renowned short seller Jim Chanos will transform his hedge fund Chanos&Co. into a family office and consulting firm. Chanos' hedge funds short companies they believe are overvalued or fraudulent.
Chanos told the media that he will no longer operate limited partnership enterprises or offshore funds, but will return external capital to investors.
It is reported that Chanos& The scale of assets managed by Co. has significantly decreased, from $6 billion in 2008 to below $200 million.
With the US stock market rebounding in 2023, Chanos has been struggling to profit from his bearish position. The S&P 500 index has risen nearly 18% year to date, and is expected to rise 7.6% in November. Due to market bets that the Federal Reserve will start cutting interest rates in 2024, the US stock market rebounded strongly in November.
Chanos is known for short selling Enron before its bankruptcy in 2001. He also made profitable bets on the struggling payment company Wirecard.
Short selling Tesla to suffer losses
Chanos has long been pessimistic about Tesla, having previously stated that "Tesla's equity is worthless" and stating that he is "basically still Tesla's biggest bear". He started short selling Tesla in 2016, but reduced his short bets before the electric vehicle company was included in the S&P 500 index at the end of 2020.
In January of this year, he once again increased his efforts to short Tesla, citing the increasingly fierce competition in the electric vehicle market. He pointed out that in China, one of Tesla's most important markets, local manufacturer BYD and other car companies have a huge market share. Compared to companies that grow faster in China, Tesla's trading price is higher.
In fact, throughout 2023, Tesla lowered prices for its Model S and Model S models in China and launched lower cost models in the United States to cope with the rise of competitors in the electric vehicle market.
Nevertheless, as investors flock to the so-called "Big Seven" of technology, Tesla's stock price has risen by 90% this year. Since 2015, Tesla's stock price has skyrocketed by over 1500%. This electric vehicle manufacturer is currently one of the world's highest market capitalization companies. The short selling of Tesla resulted in significant losses for Chanos' funds.