Short & Caught: The ASX stocks investors are shorting right now

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Short & Caught is Stockhead’s fortnightly recap of which ASX small cap stocks are being heavily ‘shorted’. Stocks that are shorted have investors betting they fall.

Shorting works by selling stocks you do not actually own in the hope of buying them back at a lower price.

Because shorting is restricted under Australian law, any substantial shorting of stocks is worth knowing about, even if you own these stocks and only trade long.

Stockhead observes the volume of short interest in the number of shares and the extent to which it has moved in the last month.

Silver stocks become targets

In recent weeks, silver has enjoyed a stellar run but that hasn’t stopped a couple of stocks with exposure to silver towards the top of the list.

One is pure play Silver Mines (ASX:SVL). Its New South Wales project is one of the world’s largest silver deposits and shares have doubled in the last month.

Another is Galena Mining (ASX:G1A) which holds the lead-silver Abra project in Western Australia’s Gascoyne region. It has a resource estimate of 37.4 million tonnes including 18g/t silver as well as 7.5 per cent lead.

Other shorted resources stocks included Namibian focused uranium play Paladin Energy (ASX:PDN) and Victorian focused copper play Stavely Minerals (ASX:SVY).

Health stocks shorted

After several months of speculation it was moving to another exchange G Medical (ASX:GMV) finally announced earlier this month it wanted to list on the NASDAQ.

Its move will involve delisting from the ASX, where the stock has underperformed since it announced the plans. Indeed, the volume of shares shorted is up 729 per cent.

Another stock which saw an increase in the volume of short interest is PainChek (ASX:PCK) which in 2020 has never managed to reach the heights of last year.

This is despite most other tele-health stocks gaining from COVID-19, as lockdown restrictions left patients with little other choice but to move their appointments online.

One stock on the fringe of telehealth is buy now pay later (BNPL) company Openpay (ASX:OPY).

A few weeks ago Openpay signed a deal with telehealth pureplay 1st Group (ASX:1ST) to help the latter’s patients pay for their services.

Openpay too has seen a rise in short interest volumes – by 80 per cent in the last month.

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