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:
- Boss Energy Ltd (ASX: BOE) continues to be the most shorted ASX share with short interest of 20.2%. This is up strongly week on week. It seems that short sellers have begun loading up on the uranium stock again despite its better than expected quarterly update.
- Paladin Energy Ltd (ASX: PDN) has seen its short interest rebound to 16.9%. Short sellers appear to believe the market is too optimistic on the outlook for uranium prices.
- Mineral Resources Ltd (ASX: MIN) has short interest of 12.5%, which is up strongly since last week. Short sellers will have been pleased to see this mining and mining services stock sink last week following a poor half year result.
- IDP Education Ltd (ASX: IEL) has 12.3% of its shares held short, which is up slightly week on week. Short sellers are expecting this student placement and language testing company to struggle this year due to student visa changes.
- Syrah Resources Ltd (ASX: SYR) has short interest of 12.1%, which is up since last week. This graphite miner had to declare a force majeure at its Balama operation in Africa late last year.
- Pilbara Minerals Ltd (ASX: PLS) short interest of 11.3%, which is up week on week. Last week, the lithium miner released its half year results and revealed a sizeable loss due to weak battery materials prices.
- Star Entertainment Group Ltd (ASX: SGR) has jumped into the top ten with short interest of 11.1%. There are concerns that this embattled casino and resorts operator could soon go bust.
- Deep Yellow Limited (ASX: DYL) has 10.9% of its shares held short, which is up week on week. This is another uranium stock that short sellers are going after.
- Domino's Pizza Enterprises Ltd (ASX: DMP) has 10.9% of its shares held short, which is flat week on week. Unfortunately for short sellers, this pizza chain operator's shares have rallied this month on good news.
- DroneShield Ltd (ASX: DRO) has entered the top ten with short interest of 10.2%. Short sellers may believe that a potential peace deal between the Ukraine and Russia could lessen demand for its offering.
