Short & Caught is Stockhead’s fortnightly recap of which ASX small cap stocks are heavily shorted. Stocks that are shorted have investors betting that 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’s two preferred metrics are raw short interest as well as percentage changes in them within the last month.

The most shorted

Shorting is not a quick buying and selling activity, traders wait months to close out trades (especially if in the short term they are wrong). Short interest represents where shorting has been initiated but not closed out.

Lithium miner Galaxy Resources (ASX:GXY) was the most shorted. Despite the strong year 2019 has been it has lost 45 per cent. An avalanche of supply has hit the lithium sector and while no one is sure when it will end, shorters are sitting tight.

Shorters are also sitting tight with Myer (ASX:MYR) and Speedcast (ASX:SDA), both victims of share price crashes.

One new stock we noted was cannabis play Botanix Pharmaceuticals (ASX:BOT). It has begun to fall in the last month after a capital raising but has still more than doubled this winter.

Code Name Price (I) Short Interest (Shares) Market Cap
GXY GALAXY RESOURCES LTD 1.13 67.44M 493.26M
MYR MYER HOLDINGS LTD 0.52 61.78M 435.28M
SYR SYRAH RESOURCES LTD 0.65 59.17M 289.36M
FAR FAR LTD 0.06 45.38M 395.66M
AJM ALTURA MINING LTD 0.09 45.09M 209.29M
CLQ CLEAN TEQ HOLDINGS LTD 0.35 42.57M 276.19M
INR IONEER LTD 0.16 39.08M 228.62M
NCZ NEW CENTURY RESOURCES LTD 0.29 35.03M 182.57M
LNG LIQUEFIED NATURAL GAS LTD 0.18 33.94M 109.44M
MLX METALS X LTD 0.17 30.71M 113.69M
SEA SUNDANCE ENERGY AUSTRALIA LTD 0.16 30.22M 113.45M
GRR GRANGE RESOURCES LTD 0.22 29.27M 254.61M
MRM MMA OFFSHORE LTD 0.18 28.76M 154.45M
SDA SPEEDCAST INTERNATIONAL LTD 1.72 20.08M 411.16M
EWC ENERGY WORLD CORP LTD 0.08 18.89M 134.67M
DCN DACIAN GOLD LTD 1.22 18.82M 253.13M
PDN PALADIN ENERGY LTD 0.13 18.74M 227.77M
ECX ECLIPX GROUP LTD 1.54 15.79M 492.24M
BWX BWX LTD 3 14.75M 372.75M
BOT BOTANIX PHARMACEUTICALS LTD 0.2 12.82M 197.72M
AMI AURELIA METALS LTD 0.53 11.29M 438.28M
CLH COLLECTION HOUSE LTD 1.12 10.74M 155.99M
SLC SUPERLOOP LTD 0.89 10.25M 226.70M

The newly shorted

Biotech company Imugene (ASX:IMU) is one of those newly shorted in recent days.

These companies’ ‘make or break’ moments are clinical trials, especially phase II, and Imugene is in the middle of one with its anti-gastric cancer vaccine. If a drug fails the test, shareholders lose but shorters will win.

Among other stocks shorted were Andrew-Forrest backed Buru Energy (ASX:BRU) and NBN-provider Uniti Wireless (ASX:UWL).

Mineral sands explorer Sheffield Resources (ASX:SFX) was also shorted. While the company is preparing the production phase of the Thunderbird project, zircon prices are currently low.

Code Name Price Short Interest (Shares) Short Interest % Change 1M Market Cap
IMU IMUGENE LTD 0.02 1.33M 66,393,000 83.03M
ARU ARAFURA RESOURCES LTD 0.06 4.35M 19,692 71.73M
QMS QMS MEDIA LTD 0.86 55.62k 7789.36 296.27M
GNX GENEX POWER LTD 0.19 187.50k 7400 78.36M
NMT NEOMETALS LTD 0.17 197.13k 4439.07 92.55M
SFX SHEFFIELD RESOURCES LTD 0.51 995.30k 3883.76 144.54M
OMN ONEMARKET LTD 0.68 520.66k 2984.09 70.15M
BDA BOD AUSTRALIA LTD 0.47 255.88k 2424.22 41.71M
BRU BURU ENERGY LTD 0.24 416.82k 2144.59 105.86M
LYL LYCOPODIUM LTD 6 244 1933.33 238.39M
ISD ISENTIA GROUP LTD 0.39 141.05k 1922.74 78.00M
UWL UNITI WIRELESS LTD 1.41 14.32k 1622.98 239.37M
EPD EMPIRED LTD 0.27 44.02k 1278.33 43.23M
AGY ARGOSY MINERALS LTD 0.09 18.00k 1169.39 93.33M
KLL KALIUM LAKES LTD 0.5 1.06M 960.35 190.74M
BOT BOTANIX PHARMACEUTICALS LTD 0.2 12.82M 938.39 197.72M
SXE SOUTHERN CROSS ELECTRICAL 0.5 1.20k 856.8 119.37M
AON APOLLO MINERALS LTD 0.03 22.37k 826.09 4.88M
PAR PARADIGM BIOPHARMACEUTICALS 1.39 347.05k 615.94 267.17M
ANO ADVANCE NANOTEK LTD 4.97 542 560.98 268.68M
AFG AUSTRALIAN FINANCE GROUP LTD 2.23 13.39k 551.73 472.59M