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Once a 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:
- Flight Centre Travel Group Ltd (ASX: FLT) remains the most shorted ASX share after its short interest rose again to 13.9%. Short sellers appear to believe the Omicron variant of COVID-19 could push back the travel market recovery.
- Kogan.com Ltd (ASX: KGN) has seen its short interest rise to 12.4%. A bad year got even worse for this ecommerce company last week when it was kicked out of the ASX 200 index.
- Redbubble Ltd (ASX: RBL) has short interest of 11.6%, which is up again week on week. Much to the delight of short sellers, Redbubble was also kicked out of the ASX 200 index at the next quarterly rebalance.
- Webjet Limited (ASX: WEB) has short interest of 9.4%, which is up week on week. Short sellers appear to believe Webjet's recovery will be disrupted by the Omicron variant.
- Mesoblast limited (ASX: MSB) has short interest of 9.1%, which is up week on week. Balance sheet and trial uncertainty appear to be behind this high level of short interest.
- Zip Co Ltd (ASX: Z1P) has seen its short interest remain flat at 9%. Intense competition, concerns about rising industry fraud, and increasing costs could be weighing on sentiment.
- Omni Bridgeway Ltd (ASX: OBL) has short interest of 8.3%, which is up strongly week on week. It remains unclear why short sellers are targeting the class action funder, but their conviction appears to be increasing.
- Appen Ltd (ASX: APX) has entered the top ten with short interest of 8.1%. This appears to have been driven by reports that big tech companies are bypassing Appen and opting for in-house data annotation for artificial intelligence models. The launch of a competing product by Amazon could also be weighing on sentiment.
- BHP Group Ltd (ASX: BHP) has short interest of 8%. Short sellers could be expecting weaker iron ore prices to lead to the mining giant falling short of expectations.
- Polynovo Ltd (ASX: PNV) is back in the top ten with short interest of 7.5%. This medical device company's softer than expected sales and CEO resignation have weighed on its shares this year.
