These are the 10 most shorted ASX shares

Short sellers are targeting these ASX shares…

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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:

  • Webjet Limited (ASX: WEB) continues to be the most shorted ASX share after its short interest rose to 11.4%. Short sellers have been going after the online travel agent due to fears over the spread of the Delta strain of COVID-19 and the impact this will have on travel markets.
  • Flight Centre Travel Group Ltd (ASX: FLT) has seen its short interest rise to strongly to 11.4%. This travel agent's shares are being targeted by concerns over longer than expected delays in the travel market recovery.
  • Zip Co Ltd (ASX: Z1P) has seen its short interest fall again week on week to 9.3%. Short sellers continue to close positions amid recent M&A activity in the BNPL industry. There is speculation Zip could be a potential takeover target of larger rival Klarna.
  • Kogan.com Ltd (ASX: KGN) has short interest of 8.6%, which is down week on week. Short sellers may have been closing positions amid optimism that lockdowns will boost this ecommerce company's sales.
  • Inghams Group Ltd (ASX: ING) has 8.3% of its shares held short, which is down week on week. Short sellers were targeting the company due to fears over its supply contract with Woolworths Group Ltd (ASX: WOW). It accounts for around 50% of its Australian poultry volumes and was due to expire this month. Unfortunately for short sellers, the two parties have agreed in principle to a renewal on broadly similar terms.
  • Electro Optic Systems Hldg Ltd (ASX: EOS) has 8.3% of its shares held short, which is down week on week. Concerns over accounting methods, cash flow generation, and supply chain fears are weighing on sentiment.
  • Tassal Group Limited (ASX: TGR) has short interest of 7.3%, which is down notably week on week. Recent M&A activity in the industry appears to have led to short sellers closing positions.
  • PolyNovo Ltd (ASX: PNV) has seen its short interest edge lower to 6.9%. This medical device company's share are trading close to a 52-week low. This has been driven by its disappointing finish to FY 2021.
  • Temple & Webster Group Ltd (ASX: TPW) is back in the top ten with short interest of 6.7%. Short sellers aren't giving up on this furniture and homewares retailer despite the expectation that lockdowns will boost its sales.
  • Resolute Mining Limited (ASX: RSG) has also returned to the top ten with short interest of 6.5%. This gold miner has underwhelmed in FY 2021 due to production and regulatory issues. Also, last week it announced that it expects to recognise a non-cash impairment charge in the range of US$165 million to US$175 million during the first half of the financial year.

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of and has recommended Electro Optic Systems Holdings Limited, Kogan.com ltd, POLYNOVO FPO, Temple & Webster Group Ltd, and ZIPCOLTD FPO. The Motley Fool Australia owns shares of and has recommended Electro Optic Systems Holdings Limited, Kogan.com ltd, and Webjet Ltd. The Motley Fool Australia has recommended Flight Centre Travel Group Limited and Temple & Webster Group Ltd. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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