Everyone seems to hate short-sellers on the way down. However, this is the first I’ve heard about people complaining about short-sellers on the way up. Bloomberg reports German Regulator Looking Into Volkswagen Trading After Surge:

Germany’s financial-markets regulator is looking into trading of Volkswagen AG shares after Porsche SE’s plan to raise its stake in the automaker triggered a fourfold increase in two days.

…

Volkswagen, Europe’s biggest carmaker, is the most shorted stock in Germany’s benchmark DAX Index. The so-called short squeeze today pushed the value of Wolfsburg, Germany-based Volkswagen’s common shares as high as 296 billion euros ($370 billion), more than Exxon Mobil Corp.’s $343 billion at yesterday’s close in New York, according to data compiled by Bloomberg.

Short sellers are getting slaughtered. What’s wrong with that? The price of Volkswagen was quite reasonably priced prior to the squeeze, so it’s not that the short sellers were depressing the price too much. So who cares that it is now valued at more than Exxon Mobile? If you are a shareholder, now is a fantastic time to take profit. As people do take their profits, the share price will fall back toward reasonable prices, and longer term shareholders will have been rewarded at the expense of the shorts at a time when the vast majority have been losing money on stocks.

UPDATE

From CNBC (TV), 12% of VW’s float was sold short. 12% is big, but not huge. For example, E*Trade is at 17% of float, and Cal-Maine’s shorts are at 58% of float. Part of the rally seems to be due to the fact that Brokers have raised margin requirements (CNBC’s analysis, not mine).