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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:
- Pilbara Minerals Ltd (ASX: PLS) continues its long run as the most shorted ASX share. It currently has a short interest of 21.9%, which is down slightly week on week. Short sellers appear to be betting on lithium prices remaining under pressure for some time to come.
- IDP Education Ltd (ASX: IEL) has 15.9% of its shares held short, which is up week on week. Short sellers have been targeting this student placement and language testing company due to regulatory changes to student visas and the loss of its language testing monopoly in Canada.
- Syrah Resources Ltd (ASX: SYR) has a short interest of 13.5%, which is up slightly week on week. Last week, this graphite miner reported a quarterly operating cash outflow of US$17.3 million. This is being driven by weak graphite prices.
- Flight Centre Travel Group Ltd (ASX: FLT) has seen its short interest increase week on week to 11.6%. Short sellers appear to believe that the market is too optimistic on the travel agent's revenue margins.
- Liontown Resources Ltd (ASX: LTR) has 10.7% of its share held short, which is up week on week. Weak lithium prices continue to weigh on the Kathleen Valley Lithium Project owner's shares.
- Core Lithium Ltd (ASX: CXO) has a short interest of 8.2%, which is down week on week. Core Lithium's shares are down more than 80% over the last 12 months, much to the delight of short sellers.
- Sayona Mining Ltd (ASX: SYA) has a short interest of 8.1%, which is down week on week. This lithium miner recently released its quarterly update and revealed that it was selling its lithium for $500 less per tonne than it cost to produce.
- Bank of Queensland Ltd (ASX: BOQ) has 7.4% of its shares held short, which is down slightly week on week. This short interest appears to have been driven by concerns over the regional bank's expense growth and potential structural margin compression.
- Westgold Resources Ltd (ASX: WGX) has entered the top ten with a short interest of 7.4%. Short sellers appear to have doubts over the gold miner's plan to merge with Canada-based Karoa Resources.
- Weebit Nano Ltd (ASX: WBT) has 7.3% of its shares held short, which is down week on week. This semiconductor company released its quarterly update last week and reported zero cash receipts. It has a market capitalisation of $560 million.
