At the start of each week I like to look at ASIC's short position report to find out which shares are being targeted by short sellers.
This is because I believe it is well 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:
- Webjet Limited (ASX: WEB) continues to be the most shorted share on the ASX despite its short interest easing slightly to 14.9%. There are concerns that a recent outbreak of COVID-19 in New South Wales and Victoria and escalating cases across the world could delay the recovery of the travel market.
- Tassal Group Limited (ASX: TGR) has seen its short interest fall to 10.8%. Short sellers have been going after the salmon producer amid concerns that China could put tariffs on Australian salmon exports in the future.
- Mesoblast limited (ASX: MSB) has seen its short interest ease to 9.3%. This biotech company's shares have come under pressure recently after the release of a series of very disappointing updates.
- Flight Centre Travel Group Ltd (ASX: FLT) has seen its short interest rise to 8.2%. As with Webjet, the recent COVID outbreak in New South Wales and Victoria appears to be weighing on sentiment in the travel sector.
- Myer Holdings Ltd (ASX: MYR) has seen its short interest fall to 8.2%. This department store operator has been hit hard this year after the pandemic accelerated the shift to online shopping. This could have a big impact on the company's turnaround plans.
- Inghams Group Ltd (ASX: ING) has 8.1% of its shares held short, which is down week on week. The poultry producer was a very disappointing performer in FY 2020 and it appears as though short sellers don't believe the worst is over.
- InvoCare Limited (ASX: IVC) has short interest of 8.1%, which is also down week on week. There are concerns that this funeral company is losing market share to rivals. This could weigh on its performance in FY 2021.
- Zip Co Ltd (ASX: Z1P) has seen its short interest increase to 7.8%. Short sellers may be going after Zip due to rising competition in the United States from the likes of Shopify and PayPal.
- Metcash Limited (ASX: MTS) is back in the top ten with short interest of 7.8%. Short sellers aren't giving up on this one despite its very strong performance over the last few months. They may now believe its shares are overvalued.
- A2 Milk Company Ltd (ASX: A2M) has also returned to the top ten with short interest of 7.6%. This infant formula company's shares have recovered strongly since crashing lower following a guidance downgrade. It appears as though short sellers aren't convinced that its operational recovery will be as quick.
