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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:
- Pilbara Minerals Ltd (ASX: PLS) continues its long run as the most shorted ASX share with 20.8% of its shares held short. Falling lithium prices have been behind this.
- Syrah Resources Ltd (ASX: SYR) has short interest of 14.4%, which is down slightly week on week. Weak graphite demand has been weighing on prices.
- Core Lithium Ltd (ASX: CXO) has a short interest of 11.8%, which is up sharply week on week. Short sellers may be regretting topping up their holdings after a very strong gain last week on optimism that lithium prices have bottomed.
- Genesis Minerals Ltd (ASX: GMD) has seen its short interest rise to 9.5%. The market appears concerned with this gold miner's recent acquisition spree.
- IDP Education Ltd (ASX: IEL) has 9% of its shares held short, which is down week on week. This may be due to student visa changes and the loss of its monopoly in Canada.
- Flight Centre Travel Group Ltd (ASX: FLT) has 8.9% of its shares held short, which is up week on week. Short sellers may believe that current trading conditions are unfavourable for its revenue margins.
- Sayona Mining Ltd (ASX: SYA) has 8.7% of its shares held short, which is down week on week. This is another lithium miner that short sellers have been targeting.
- Deep Yellow Limited (ASX: DYL) has entered the top ten with a short interest of 8%. Short sellers may believe that the market is too bullish on uranium. Deep Yellow's shares are up 40% year to date.
- Bank of Queensland Ltd (ASX: BOQ) has a short interest of 7.8%, which is down slightly from last week. Intense competition in Australian mortgage loans could be behind this.
- Appen Ltd (ASX: APX) is back in the top ten with a short interest of 7.7%. This artificial intelligence (AI) data services company has been struggling despite the AI boom. Short sellers don't appear to believe this will be a quick fix.
