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 with short interest of 10.7%, which is down slightly week on week. Short sellers may believe that revenue margin headwinds will weigh on its performance.
- Core Lithium Ltd (ASX: CXO) has short interest of 9.8%, which is up week on week again. A number of brokers continue to believe that this lithium miner is overvalued based on its mineral resource.
- Lake Resources N.L. (ASX: LKE) has 9.1% of its shares in the hands of short sellers, which is up again since last week. Short sellers don't appear to believe that recent lithium price strength will last.
- Sayona Mining Ltd (ASX: SYA) has seen its short interest rise to 8.25%. This lithium developer's shares fell last week after announcing a surprise $200 million capital raising.
- Megaport Ltd (ASX: MP1) has leapt back into the top ten with short interest of 8.2%. Short sellers may believe that the market is too optimistic on this network as a service operator's outlook.
- Jervois Global Ltd (ASX: JRV) has 8% of its shares held short, which is down week on week. This cobalt developer's shares have crashed deep into the red since suspending the final construction of the Idaho Cobalt Operation.
- AMA Group Ltd (ASX: AMA) has seen its short interest rise to 7.9%. Short sellers may be targeting this crash repair company due to its precarious balance sheet.
- Zip Co Ltd (ASX: ZIP) has short interest of 7.6%, which is down week on week again. Some short sellers may be closing positions following news of favourable regulatory changes.
- Breville Group Ltd (ASX: BRG) has entered the top ten with 7.6% of its shares held short. This may be due to concerns over how the cost of living crisis could impact demand for appliances.
- Temple & Webster Group Ltd (ASX: TPW) has returned to the top ten with 7.6% of its shares in the hands of short sellers. Short sellers don't appear confident that this online furniture retailer's improving sales will last.
