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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:
- Flight Centre Travel Group Ltd (ASX: FLT) remains the most shorted ASX share after its short interest rose to 11.7%. Revenue margin headwinds could be the reason for this.
- Core Lithium Ltd (ASX: CXO) has short interest of 10%, which is flat week on week. Concerns over falling lithium prices has been behind this. Though, M&A activity in the industry is likely to be making short sellers nervous.
- Zip Co Ltd (ASX: ZIP) has short interest of 9.9%, which is down marginally week on week. This is despite the buy now pay later provider reiterating its profit targets last week.
- Liontown Resources Ltd (ASX: LTR) has short interest of 9.1%, which is up week on week. Short sellers may be regretting this one. Last week a takeover approach sent this lithium share rocketing higher.
- Megaport Ltd (ASX: MP1) has seen its short interest ease to 9.1%. Softening growth and the exit of its CEO and CFO last month seem to have caused concerns.
- Sayona Mining Ltd (ASX: SYA) has 8.5% of its shares held short, which is down week on week. Short sellers may also have some regrets with this lithium share after it recorded a strong gain last week.
- JB Hi-Fi Limited (ASX: JBH) has seen its short interest rise to 7.9%. Short sellers appear to believe that the cost of living crisis could impact consumer spending on household goods.
- Temple & Webster Group Ltd (ASX: TPW) has entered the top ten after its short interest jumped to 7.3%. This may be due to concerns that this online furniture retailer could be struggling in the current environment.
- Pointsbet Holdings Ltd (ASX: PBH) has short interest of 7.2%, which is up week on week. Competition and cash burn concerns may be why short sellers are targeting this sport betting company.
- Brainchip Holdings Ltd (ASX: BRN) has seen its short interest ease slightly to 7.2%. This is likely to be down to this semiconductor company's ridiculous valuation on less revenue than a Sydney CBD café. It also faces competition from huge players that could easily acquire Brainchip if they thought it was a threat.
