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Short Seller Series Recap: Key Trends in ASX Short Selling Activity
Welcome back to the Short Seller Series, where we analyse the most shorted stocks on the Australian Securities Exchange (ASX) and spotlight changes in short interest over the past week. Given that short selling data is reported three business days after trades, our information is slightly delayed; however, it provides valuable insights.
Short Selling Trends: Week of 14-21 July
We will examine three main aspects:
- Week-on-week changes: 14 to 21 July
- Month-on-month changes: 23 June to 21 July
- Significant changes in short interest: Stocks with movements of 0.5% or more
Most Shorted Stocks
Below are the ten most shorted stocks on the ASX as of 21 July, along with their short interest percentage and changes over the past week and month.
| Ticker | Company | Short % | Week-on-Week Change | Month-on-Month Change |
|---|---|---|---|---|
| PDN | Paladin Energy | 16.41% | -0.48% | 0.36% |
| PLS | Pilbara Minerals | 14.45% | 0.63% | 0.94% |
| BOE | Boss Energy | 14.08% | -0.24% | -3.56% |
| MIN | Mineral Resources | 13.52% | -0.40% | -1.78% |
| IEL | Idp Education | 12.25% | 0.18% | 2.02% |
| LIC | Lifestyle Communities | 11.90% | 0.33% | 1.32% |
| LTR | Liontown Resources | 11.67% | -0.47% | -0.85% |
| SLX | SILEX Systems | 11.23% | -0.07% | 1.30% |
| PNV | Polynovo | 10.75% | -0.32% | 0.20% |
| CTD | Corporate Travel Management | 10.14% | 0.23% | 0.67% |
Rising Short Interests
Next, we explore stocks experiencing an increase in short interest, indicating a growing bearish sentiment:
| Ticker | Company | Short % | Week-on-Week Change | Month-on-Month Change |
|---|---|---|---|---|
| ILU | Iluka Resources | 6.05% | 1.74% | 1.40% |
| JBH | JB Hi-Fi | 4.13% | 1.69% | 1.45% |
| CU6 | Clarity Pharmaceuticals | 9.74% | 1.28% | 2.24% |
| ASL | Andean Silver | 1.67% | 0.78% | 0.17% |
| PLS | Pilbara Minerals | 14.45% | 0.63% | 0.94% |
| MVF | Monash IVF Group | 4.32% | 0.59% | 1.67% |
| KAR | Karoon Energy | 6.57% | 0.50% | -0.58% |
Key Insights
-
Iluka Resources saw its short interest climb to 6.0%, notably after a substantial share rally following the US Department of Defence’s $400 million investment in a rival firm, MP Materials. This investment promised a minimum NdPr price over ten years, leading to concerns about sustainability in the rare earth sector as pricing pressures emerge.
- JB Hi-Fi experienced a notable increase in short selling, now at its highest since March 2024. The stock trades at a PE of 25x, notably above its historical average of 16x, prompting scepticism about future earnings growth expectations.
Most Covered Stocks
Finally, we look at stocks that have seen a significant covering of short positions:
| Ticker | Company | Short % | Week-on-Week Change |
|---|---|---|---|
| JHX | James Hardie Industries | 2.92% | -1.71% |
| VUL | Vulcan Energy Resources | 4.05% | -1.66% |
| NVX | Novonix | 4.77% | -1.20% |
| APX | Appen | 3.48% | -0.83% |
| 360 | Life360 Inc | 0.22% | -0.83% |
| SPR | Spartan Resources | 1.25% | -0.76% |
| AUC | Ausgold | 0.49% | -0.70% |
| MSB | Mesoblast | 5.68% | -0.66% |
| ZIP | Zip Co | 4.23% | -0.58% |
| AMC | Amcor | 1.03% | -0.56% |
Summary Points
- James Hardie continues to benefit from covering following its acquisition of Azek, signalling investor confidence in its strategic moves.
- Increased covering activities in higher-risk companies like Vulcan Energy, Novonix, and Appen reflect market sentiments leaning towards reduced risk exposure.
This overview highlights the dynamic landscape of short selling in the ASX, providing insights that could inform future investment strategies.
