Renowned short seller Jim Chanos is reportedly converting his hedge fund, Chanos & Co., into a family office and advisory business. Best known for his successful bet against Enron before its 2001 bankruptcy, Chanos will no longer oversee a limited partnership or offshore fund and plans to return external capital to investors. The assets managed by Chanos & Co. have significantly decreased, falling below $200 million, compared to $6 billion in 2008.
Chanos’s shift to the family office model comes as the stock market has experienced a rally in 2023, with the S&P 500 posting a nearly 18% increase, and the broad-market index set for a 7.6% gain in November.
Famous for shorting Enron a year before its collapse, Chanos has also made recent short bets on Tesla, citing increasing competition in the electric vehicle market. In January of the same year, he pointed to China as Tesla’s weakest market, emphasizing the risk of capital repatriation and the significant market share gains by Chinese automakers like BYD. Chanos noted that Tesla traded at a premium to companies growing faster in China, suggesting various ways to play the market dynamics. Renowned short seller Jim
Indeed, throughout 2023, Tesla made price cuts on its S and X models in China, and it rolled out lower cost versions of the vehicles in the U.S. as competitors ramped up in the EV market.
Still, Tesla shares have rallied 90% this year as investors crowded into the so-called Magnificent 7 tech stocks.