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) is still the most share on the ASX after its short interest rebounded to 15%. Short sellers appear to believe the market is too optimistic on the travel market recovery.
- Betmakers Technology Group Ltd (ASX: BET) has seen its short interest ease to 13.5%. This betting technology company's shares have fallen 58% this year but short sellers appear to believe they can keep falling.
- Block Inc (ASX: SQ2) has seen its short interest rise to 10.4%. This could be due to weakness in the tech sector, concerns over the prospects of a US recession, and regulatory pressure in the BNPL industry.
- Lake Resources N.L. (ASX: LKE) has short interest of 9.9%, which is down slightly week on week. Short sellers will have been pleased to see this lithium share tumble last week after it revealed an ownership dispute with its DLE partner Lilac Solutions.
- Zip Co Ltd (ASX: ZIP) has seen its short interest ease slightly to 9.5%. This morning this buy now pay later provider's shares were kicked out of the ASX 200 index following the quarterly rebalance.
- Megaport Ltd (ASX: MP1) has returned to the top ten after its short interest jumped to 9.1%. This could be due to valuation concerns. Megaport's shares trade on huge multiples.
- City Chic Collective Ltd (ASX: CCX) has short interest of 8.6%, which is down slightly since last week. This plus sized fashion retailer's shares have come under significant pressure since the release of a very disappointing full year result which revealed a huge jump in inventory.
- Nanosonics Ltd (ASX: NAN) has short interest of 8.4%, which is down slightly week on week. This infection prevention company's shares have been targeted due to concerns over sales disruption and margin pressures from a business model change in the key US market.
- De Grey Mining Limited (ASX: DEG) has short interest of 8.2%, which is down slightly week on week. Short sellers continue to hold the gold developer's shares despite a recent positive update on its Mallina Gold Project.
- Pointsbet Holdings Ltd (ASX: PBH) has short interest of 7.7%, which is down slightly week on week. This appears to have been driven by concerns over this sport betting company's cash burn.
