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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 stayed flat at 14.6%. Fears that the Omicron variant of COVID-19 is derailing the travel market recovery continue to weigh on investor sentiment.
- Kogan.com Ltd (ASX: KGN) has seen its short interest ease to 10.4%. This ecommerce company's shares have come under pressure due to its very disappointing performance over the last 12 months and expectations that it will continue in FY 2022.
- Redbubble Ltd (ASX: RBL) has short interest of 9.4%, which is down week on week. Redbubble is another ecommerce company short sellers have been targeting due to its disappointing performance and concerns that it won't improve quickly.
- Mesoblast limited (ASX: MSB) has short interest of 9.1%, which is down week on week. Last month Novartis terminated an agreement that could have been worth US$1.25 billion to Mesoblast. This could mean Mesoblast will need to raise funds again in the not so distant future.
- Zip Co Ltd (ASX: Z1P) has seen its short interest remain flat at 9.1%. Short sellers will be celebrating that Zip's shares hit a 52-week low last week. Its shares have come under pressure due to the prospect of rising interest rates and reports that US regulators are looking into the BNPL market.
- Webjet Limited (ASX: WEB) has short interest of 8.6%, which is down week on week. As with Flight Centre, the emergence of the Omicron variant has spooked investors and put pressure on its shares.
- BHP Group Ltd (ASX: BHP) has short interest of 8.4%, which is up week on week. This appears to be driven by traders looking to profit from the unwinding of its dual listing. They have shorted its ASX shares and bought the cheaper UK shares which will eventually be repatriated.
- Polynovo Ltd (ASX: PNV) has seen its short interest rise to 7.6%. Short sellers continue to increase their positions despite the medical device company releasing a much-improved sales update last month.
- Betmakers Technology Group Ltd (ASX: BET) has entered the top ten with short interest of 7.3%. Investors may have concerns over the lofty multiples this betting technology company's shares trade on.
- Appen Ltd (ASX: APX) has seen its short interest remain flat at 7.2%. This may be due to reports that some tech companies are bypassing artificial intelligence data services providers like Appen and taking things in-house.
