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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) takes the crown on the most shorted list for another week after its short interest rose to 17.1%. The market remains incredibly divided on the travel sector recovery with some companies predicting growth on 2019's numbers and others predicting declines in 2022.
- Betmakers Technology Group Ltd (ASX: BET) has seen its short interest rise to 13.6%. Short sellers will have been pleased to see this betting technology company's shares crash to a two-year low last week. Loss-making tech shares are out of favour with the market right now.
- Nanosonics Ltd (ASX: NAN) has short interest of 12.4%, which is up week on week. This medical device company's shares have been sold off this year due to uncertainty caused by a major change to its sales model in the United States.
- Kogan.com Ltd (ASX: KGN) has seen its short interest climb again to 10.3%. This ecommerce company continues to be a target of short sellers due to its poor sales performance, strong competition, margin pressures, and its dire inventory management.
- Polynovo Ltd (ASX: PNV) has seen its short interest remain flat at 10%. Valuation concerns have been weighing on this medical device company's shares. Though, clearly a couple of insiders don't agree that PolyNovo's shares are overvalued. Last week the company reported some major insider buying.
- EML Payments Ltd (ASX: EML) has seen its short interest jump to 10%. Short sellers have increased their positions in this payments company after it downgraded its profit guidance following a tough third quarter.
- Webjet Limited (ASX: WEB) has short interest of 9.3%, which is down week on week once again. As with Flight Centre, mixed messages out of the travel sector appear to have short sellers believing that the market is too bullish on the sector recovery.
- AMA Group Ltd (ASX: AMA) has 8.9% of its shares held short, which is up week on week. Short sellers aren't giving up on this smash repair company despite its shares hitting a two-year low last week. Its high debt load and dwindling cash balance are weighing heavily on sentiment.
- Appen Ltd (ASX: APX) has returned to the top ten after its short interest rose to 8.9%. Concerns over softening demand for its services and a lack of guidance for FY 2022 appear to have attracted short sellers.
- Zip Co Ltd (ASX: Z1P) has seen its short interest fall to 8.25%. This buy now pay later provider's shares have fallen out of favour with investors amid slowing growth and rising costs.
