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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:
- Flight Centre Travel Group Ltd (ASX: FLT) remains the most shorted ASX share even though its short interest eased slightly to 11.7%. There are concerns that airlines may not be offering as much margin to travel agents due to a lack of competition.
- Megaport Ltd (ASX: MP1) has seen its short interest ease a touch to 11.1%. Short sellers may be regretting this one. They appear to have been caught up in a short squeeze last week after a stronger than expected update sent this network as a service company's shares rocketing over 40% higher.
- Zip Co Ltd (ASX: ZIP) has short interest of 10.3%, which is up slightly week on week. Traders appear to be betting against this buy now pay later provider achieving its profit goals.
- Sayona Mining Ltd (ASX: SYA) has seen its short interest rebound to 9.1%. Short sellers continue to target the lithium industry due to continued weakness in prices of the battery making ingredient.
- Core Lithium Ltd (ASX: CXO) has short interest of 8.9%, which is down slightly week on week again. This lithium miner's shares trade at a significant premium to peers according to some brokers.
- Jervois Global Ltd (ASX: JRV) has 8.5% of its shares held short, which is up week on week. This cobalt developer recently suspended the final construction of the Idaho Cobalt Operations due to low cobalt prices. It has already spent US$130 million on its construction.
- Temple & Webster Group Ltd (ASX: TPW) has seen its short interest remain flat at 8.5%. The housing market downturn and shift back to offline shopping appear to be weighing on sentiment.
- Lake Resources N.L. (ASX: LKE) has 8.3% of its shares in the hands of short sellers. This is another lithium share being targeted by short sellers amid falling battery material prices.
- JB Hi-Fi Limited (ASX: JBH) has short interest of 8%, which is down week on week. Short sellers may believe that this retail giant's sales could suffer due to the housing market downturn and cost of living crisis.
- AMA Group Ltd (ASX: AMA) has 7.9% of its shares held short. This may be due to concerns over the state of this smash repair company's balance sheet.
