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:
- Pilbara Minerals Ltd (ASX: PLS) continues its long run as the most shorted ASX share after its short interest held firm at 21%. Short sellers don't appear to believe that lithium prices will be improving meaningfully in the near term.
- Syrah Resources Ltd (ASX: SYR) has short interest of 17.1%, which is down week on week. This graphite producer's shares jumped last week thanks to a new offtake agreement.
- Core Lithium Ltd (ASX: CXO) has short interest of 11.3%, which is down again week on week. This lithium miner plans to suspend production to reduce costs while prices are low.
- Chalice Mining Ltd (ASX: CHN) has short interest of 9.9%, which is up week on week. This mineral exploration company's production is still years away, making it hard to value its project.
- Deep Yellow Limited (ASX: DYL) has seen its short interest rise slightly to 9.9%. Short sellers don't appear to believe that uranium prices will be as strong as the market is predicting.
- IDP Education Ltd (ASX: IEL) has 9.3% of its shares held short, which is down sharply week on week. This language testing and student placement company's shares have fallen heavily over the last 12 months due to student visa changes.
- Genesis Minerals Ltd (ASX: GMD) has seen its short interest remain flat at 9.2%. This appears to be due to concerns over integration risks from its recent acquisition spree.
- Sayona Mining Ltd (ASX: SYA) has 8.5% of its shares held short, which is down week on week. A large shareholder recently sold off its stake at a big discount.
- Flight Centre Travel Group Ltd (ASX: FLT) has 8.4% of its shares held short, which is flat week on week. Last week, the travel agent released a half-year result that fell short of expectations.
- Weebit Nano Ltd (ASX: WBT) has short interest of 7.9%, which is down week on week. Valuation and revenue generation concerns are likely to be behind this.
