Once a week, I like to take a look at ASIC's short position report to see which ASX shares are attracting the most attention from short sellers.
High short interest can indicate that investors are concerned about a company's outlook, although there can be other reasons for taking short positions.
With that in mind, here are the 10 most shorted ASX shares this week, according to ASIC.
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The top 10 most shorted ASX shares
- PLS Group Ltd (ASX: PLS) has climbed to the top of the table after its short interest jumped from 15.4% to 16.8%. The lithium producer recently reported record quarterly production and lower costs at Pilgangoora. However, its decision to proceed with the $1.9 billion P2000 expansion could be catching the eye of short sellers, especially given the risks of committing significant capital in a volatile lithium market.
- Lotus Resources Ltd (ASX: LOT) has seen its short interest increase to 16.7%. The uranium producer has made progress at its Kayelekera mine in Malawi, with recovery rates improving and its first uranium shipment departing in November. However, production remains well below its longer-term ambitions, and short sellers may be questioning how quickly the company can resolve operational challenges and increase output.
- DroneShield Ltd (ASX: DRO) has short interest of 16%, down slightly week on week. The counter-drone technology company's growing order pipeline offers substantial potential, but converting opportunities into consistent revenue and earnings remains a challenge. An ongoing ASIC investigation into historical company disclosures and share trading could also be contributing to uncertainty.
- Glencore plc (ASX: GLC) has seen its short interest fall sharply from 17.9% to 15.4%. The mining and commodities trading giant joined the ASX last month, and its multiple international listings could explain some of the unusual short-selling activity. These positions may reflect trading and hedging strategies.
- Zip Co Ltd (ASX: ZIP) has short interest of 14.6%, down from 15.7%. The buy now, pay later provider recently reported strong US transaction growth and reaffirmed its FY 2027 earnings guidance. However, higher bad debts and a US fraud incident could be raising questions about the profitability and sustainability of its rapid expansion.
- Paladin Energy Ltd (ASX: PDN) has seen its short interest edge lower to 14.5%. Its September-quarter update revealed weaker uranium production and higher costs at the Langer Heinrich mine. Although management maintained its FY 2027 guidance, short sellers may be concerned about whether production can recover sufficiently in the second half to meet its targets.
- Boss Energy Ltd (ASX: BOE) has short interest of 14%, down from 15%. The uranium producer recently reaffirmed its FY 2027 production and cost guidance for the Honeymoon operation. However, uncertainty remains over whether its revised mining approach can consistently deliver the production volumes and cost improvements outlined in its new feasibility study.
- Lynas Rare Earths Ltd (ASX: LYC) has seen its short interest increase from 12.7% to 13.8%. The rare earths producer is progressing its proposed acquisition of Meteoric Resources (ASX: MEI), which would add the Caldeira project in Brazil to its portfolio. The substantial investment potentially required to develop this project, alongside volatile rare earth prices, may be behind the high level of short interest.
- Vulcan Energy Resources Ltd (ASX: VUL) has entered the top ten with short interest of 13.1%. The lithium developer recently reported further construction and drilling progress at its Lionheart project in Germany, which remains on schedule. However, short sellers may be concerned about the challenges of delivering such a large development, including construction costs, production ramp-up risks, and future lithium prices.
- IperionX Ltd (ASX: IPX) rounds out the top ten with short interest of 12.9%, down from 13.2%. The titanium producer reported a substantial increase in production at its US manufacturing facility during the September quarter. Nevertheless, investors may be questioning how quickly it can translate growing production capacity and promising commercial opportunities into substantial revenue and profits.
