Every Monday I like to look at ASIC's short position report in order to find out which shares are being targeted by short sellers.
This is because I believe it is worth keeping a close eye on short interest levels as high levels can sometimes be a sign that something isn't quite right with a company.
With that in mind, here are the 10 most shorted shares on the ASX this week according to ASIC:
- Galaxy Resources Limited (ASX: GXY) continues to be the most shorted share on the ASX despite a reduction in its short interest to 18.1%. Short sellers don't appear to believe that the worst is over for the lithium miners.
- Syrah Resources Ltd (ASX: SYR) has seen its short interest slide to 16.6%. This graphite producer's shares have come under pressure over the last 18 months due to a sustained decline in the price of its graphite. This has been caused by to oversupply concerns.
- Nearmap Ltd (ASX: NEA) has seen its short interest jump to 14%. Short sellers have increased their positions following a disappointing guidance downgrade late last month. Short sellers appear to believe that things could get worse before they get better.
- Orocobre Limited (ASX: ORE) has seen its short interest drop lower again to 13.2%. As with Galaxy, this lithium miner has been targeted due to weakening lithium prices from softer demand and increasing supply.
- Speedcast International Ltd (ASX: SDA) has short interest of 12.3%, which is down week on week. The communications satellite technology provider's shares are currently in a trading halt whilst it prepares an announcement relating to its upcoming results. It has also just announced the resignation of its CEO.
- Inghams Group Ltd (ASX: ING) has short interest of 12.2%, which is up slightly week on week. Concerns over rising feed costs because of the droughts and bushfires continue to weigh on this poultry producer's shares.
- GWA Group Ltd (ASX: GWA) has short interest of 11.7%, which is down week on week. This building products company will be one to watch this month. Last year it warned that trading conditions would be tough in FY 2020.
- JB Hi-Fi Limited (ASX: JBH) has seen its short interest fall slightly to 11.1%. Later today the retailer will release its half year results. Short sellers will be hoping that JB Hi-Fi doesn't smash expectations.
- Bega Cheese Ltd (ASX: BGA) is back in the top ten with short interest of 11%. The food company's performance in FY 2020 has been impacted by the fierce competition for milk.
- Costa Group Holdings Ltd (ASX: CGC) has seen its short interest rise slide to 10.9%. Short sellers appear to have been closing their positions in the horticulture company after trading conditions improved greatly in January.
