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:

• Flight Centre Travel Group Ltd (ASX: FLT) has returned to the top of the chart after its short interest rose to 12%. Short sellers don’t appear to be giving up on Flight Centre despite its return to form in FY 2023. Revenue margin headwinds may be a cause for concern.
• Betmakers Technology Group Ltd (ASX: BET) has seen its short interest ease slightly to 11.6%. Competition and cash burn concerns could be weighing on this betting technology company’s shares.
• Sayona Mining Ltd (ASX: SYA) has 10.7% of its shares held short, which is flat week on week. There are fears that lithium prices have now peaked and are about to decline materially.
• Core Lithium Ltd (ASX: CXO) has short interest of 10.1%, which is up week on week. As with Sayona Mining, continued weakness in spot lithium prices appear to have spooked investors.
• Megaport Ltd (ASX: MP1) has seen its short interest fall again to 9.3%. Short sellers have been targeting this network as a service provider after it reported softening operating trends with its results.
• Zip Co Ltd (ASX: ZIP) has short interest of 9.1%, which is up strongly week on week. Short sellers appear to be doubting this buy now pay later provider’s ability to achieve its profitability goals.
• Liontown Resources Ltd (ASX: LTR) has short interest of 8.1%, which is up week on week. Concerns over material cost blow outs at the Kathleen Valley Lithium Project have been weighing on sentiment.
• City Chic Collective Ltd (ASX: CCX) has jumped into the top ten with short interest of 7.3%. This plus sized fashion retailer’s abject performance and inventory management are likely to be behind this short interest.
• Lake Resources N.L. (ASX: LKE) has 6.9 % of its shares held short, which is flat week on week. Doubts over this lithium developer’s technology and project funding are reasons why one short seller is targeting Lake.
• Vulcan Energy Resources Ltd (ASX: VUL) has short interest of 6.8%, which is down slightly week on week. This also appears to be down to lithium prices being tipped to fall materially in the next 18 months.

The post Here are the 10 most shorted ASX shares this week appeared first on The Motley Fool Australia.

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• Buy this punished ASX 200 tech stock when it’s forced into a capital raise: expert
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• Here are the top 10 ASX 200 shares today
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• Here are the 3 most heavily traded ASX 200 shares on Friday

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Betmakers Technology Group, Megaport, and Zip Co. The Motley Fool Australia has recommended Betmakers Technology Group, Flight Centre Travel Group, and Megaport. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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