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Short-sellers have made $15 billion betting against Tesla and Nvidia in 2025

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Thu, Mar 20, 2025, 9:46 AM 2 min read

Tesla's 40% year-to-date drop has led the so-called "Magnificent Seven" declines. Investors have grown concerned about CEO Elon Musk's focus on government efficiency efforts and how his role with President Donald Trump's administration could be a turnoff to the electric vehicle maker's customer base.

But it hasn't just been Tesla lagging. As an index the "Magnificent Seven" — which also includes Apple (AAPL), Alphabet (GOOGL, GOOG), Microsoft (MSFT), Amazon (AMZN), Meta (META) — is underperforming the S&P 500 this quarter by the most since 2022.

Short sellers have profited on all of the names in the cohort this year. They've brought in nearly $5 billion betting against Apple stock, which is down nearly 14% in 2025.

The crash in the most popular trade of the past two years comes as investors have been rerating their growth expectations. Fears of slowing economic growth and the impact of Trump's tariff policies have weighed on markets. Meanwhile, Big Tech has faced growing investor criticism about its ballooning AI spend and whether or not it will eventually boost future profits as much as Wall Street hopes. The year also included a massive drawdown in some large tech names, including Nvidia, following the release of a cheaper AI model from Chinese company DeepSeek.

Now with most of the names sitting around 20% off their recent 52-week highs, the looming question for markets is whether or not investor appetite for the stocks that led the market higher for the past two years will return.

"Maybe these tech stocks got ahead of their skis a little bit," BMO Capital Markets chief investment strategist Brian Belski told Yahoo Finance last week. "But at the end of the day, these are monster companies that define the growth trajectory for the United States stock market. They are not going away."