The run-up in tech stocks has fueled the overall market to all-time highs this year. And while many investors may be cheering, short sellers have lost a fortune.

The so-called “FANG” stocks—Facebook (FB), Amazon (AMZN), Netflix (NFLX) and Alphabet (GOOGL)—have burned short investors, according to data from financial analytics firm S3 Partners. Year-to-date, Facebook short-sellers have lost $948 million, Amazon short-sellers have lost $1.5 billion, Netflix short-sellers have lost $1.6 billion, and Alphabet short-sellers have lost $1.1 billion.

Microsoft (MSFT) and Apple (AAPL), two tech stocks that Goldman Sachs included in their “FAAMG” acronym, have lost $500 million and $1.5 billion for short-sellers this year, respectively.

Combined, the “FANG”/”FAAMG” names have cost short-sellers $7.1 billion just this year.

Other high-fliers like Nvidia (NVDA) and Tesla (TSLA) have also added pain to those betting against their stocks. Nvidia short-sellers have lost $1.5 billion this year. The Tesla shorts have lost a whopping $3.9 billion.

As shown below, the group of tech momentum names has well-outperformed the S&P year-to-date.

“A lot of hedge funds are using these big tech names like Facebook, Amazon, Apple and Alphabet as a hedge against the market because they are now the market bellwethers,” according to S3 Partners head of data analytics Ihor Dusaniwsky. “It used to be Cisco, IBM, Intel as the bellwethers, but this has shifted.”

But the losses aren’t hitting just the hedgers. Dusaniwsky added that others have made bets against these tech names based on valuation or momentum.

Interestingly, the high short positions could actually create more upside potential for these names through what is often called a “short squeeze.”

“The conviction for a lot of these names is tremendous,” Dusaniwsky said. “Shorts have stayed in these names consistently even as the stocks continue to rise. If the stocks continue to go up and shorts are compelled to cover their positions at some point, the stocks could surge even more.”

Some owners of these companies can’t help but gloat. Tesla CEO Elon Musk pointed out pain for the short-sellers over three-years ago.

“Seems to be some stormy weather over in Shortville these days,” he tweeted in April 2012. And his comment still rings true as Tesla trades near all-time highs. In April 2017, he tweeted, “Tesla is absurdly overvalued if based on the past, but that’s irrelevant. A stock price represents risk-adjusted future cash flows.” And in June, he tweeted, “These guys want us to die so bad they can taste it.”

Tesla’s high-profile short-sellers include Kynikos’ Jim Chanos and Greenlight’s David Einhorn.

For now, the names continue to surge, fueled by investor attraction to secular growth stories.

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Nicole Sinclair is markets correspondent

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