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) continues to be the most shorted ASX share with short interest of 11%. Short sellers may be regretting not closing their positions sooner, though. The travel agent's shares have rallied 17% higher over the last five trading sessions.
- Kogan.com Ltd (ASX: KGN) has short interest of 9.2%, which is down notably week on week. Concerns over this ecommerce company's inventory position have been weighing on Kogan's shares.
- Webjet Limited (ASX: WEB) has short interest of 9%, which is down week on week. As with Flight Centre, the Webjet share price has been rising in recent sessions, much to the dismay of short sellers. The prospect of both state and international borders reopening in the coming months has boosted travel shares.
- Zip Co Ltd (ASX: Z1P) has seen its short interest ease to 8.9%. News that this buy now pay later provider has made an investment in India and signed a deal with Microsoft may have spooked short sellers.
- Electro Optic Systems Hldg Ltd (ASX: EOS) has 8.6% of its shares held short, which is down week on week. Short sellers continue to target this defence and space company due to accounting and cash generation concerns.
- Mesoblast limited (ASX: MSB) has seen its short interest fall slightly to 8.4%. There are concerns that Mesoblast may need to raise funds again in the near future if it doesn't have significant trial success.
- Inghams Group Ltd (ASX: ING) has 8.3% of its shares held short, which is down week on week. High grain costs could be weighing on investor sentiment.
- Redbubble Ltd (ASX: RBL) has seen its short interest rise to 7.7%. Short sellers won't have been pleased to see Morgan Stanley initiate coverage on this ecommerce company's shares with an overweight rating and $6.50 price target today.
- Cooper Energy Ltd (ASX: COE) has 7.7% of its shares held short, which is down week on week. Concerns over Project Sole continue to weigh on investor sentiment.
- Tassal Group Limited (ASX: TGR) has short interest of 7.5%. Short sellers have been targeting this seafood company due to weakness in salmon prices.