SpaceX Short Interest Rises to 13% of Free Float as Borrowing Costs Drop Sharply
Alina Collins
Just two weeks after its IPO, SpaceX short interest has jumped from 8% to 13% of the free float, while annualized borrowing costs plunged from 14% to roughly 1% — the barrier to shorting is dropping fast, but squeeze risk is building just as quickly.
How fast is short interest growing?
As of June 24, SpaceX short interest hit 13% of the free float, up from 8% just one trading day earlier — a 5-percentage-point jump.
Ortex Technologies co-founder Peter Hillerberg called the pace "remarkable for a stock that has been public only a few weeks."
This means → the market's disagreement over SpaceX's near-term valuation is widening at speed, with a growing number of traders betting on significant further downside.
Why did shorts pile in so suddenly?
SpaceX listed on June 12 and peaked at $225.64 within days, then fell roughly 30% as the broader market weakened.
The decline exceeded expectations, drawing shorts in faster than most anticipated.
In plain terms = a 30% drop from the high gave shorts a clear signal that momentum had turned, so they accelerated their bets.
Why did borrowing costs collapse?
The annualized cost to borrow SpaceX shares has fallen from 14% at listing to roughly 1% now.
This means → the supply of lendable shares has surged, and the friction cost of opening a short position has nearly vanished.
For context, the "Magnificent Seven" — Apple, Nvidia, Tesla and peers — carry borrow costs of just 0.25%–0.33% and short interest of only 1%–3%. SpaceX's 13% sits far above that range.
How much "ammunition" is left for shorts?
Utilization — the share of lendable stock already lent out — sits at roughly 39%, up from the low-30s last week.
In plain terms = about six-tenths of all lendable shares remain untouched, so shorts still have ample room to add positions.
What risk do the shorts themselves face?
SpaceX carries a market cap of roughly $2 trillion but a limited free float; current short positions total about 83 million shares against average daily volume of roughly 270 million shares.
Hillerberg warns that any rebound could force shorts to cover, stacking buy pressure on top of the rally and "pushing gains well beyond what fundamentals support" — the classic short squeeze (a chain reaction where forced buybacks by shorts amplify a price rise).
This reflects a paradox: shorting SpaceX is itself a high-risk bet. Strong retail and institutional buying interest, combined with Elon Musk's track record of publicly confronting short sellers, means a squeeze could inflict losses far exceeding what shorts bargained for.
Content is for reference only, not financial advice.