With the ASX opening 2023 on a positive note, including 13 out of 15 trading sessions ending in the green, market sentiment has largely improved. In fact, the ASX has outperformed international peers, finding itself just a fraction off a fresh all-time high. That has played a role in overall short interest decreasing across the market, but some stocks find themselves unable to shake the tag. Selfwealth does not offer short selling. Please note, data below is for information purposes and insights about sentiment, sourced from ASIC with a T+4 (4 trading day) delay. Individual short sellers report their short positions, so data is based on third-party input. There can be no guarantees regarding the accuracy of the data, and it should not be used as the basis for financial decisions. Most Shorted ASX Stocks 1. Flight Centre (ASX: FLT) Short sellers remain convinced that Flight Centre shares will decrease from here, with the stock still ranked as the most shorted ASX name at the start of 2023. Concerns about the economic outlook, not to mention the company margins, are just two of the catalysts behind persistent negative sentiment for the travel agency. With that said, short interest as a proportion of all securities is down this month by 50 basis points to 14.1%. 2. BetMakers Technology (ASX: BET) While the local share market has rallied within touching distance of its all-time high this month, shares in BetMakers Technology continue to trade at their lowest level since May, 2020. Despite a modest decrease in short interest over the last month, the aggregate short position of the stock sees 12.9% of all securities currently sold short. That is down from a high of 16.6% back in May last year, but short interest grew 80% over the last 12 months. 3. Perpetual (ASX: PPT) Fund manager Perpetual closed out its acquisition of Pendal, but short interest is showing no signs of materially decreasing. At one stage during January, aggregate short interest hit a new record of 14.0% of all securities. At the time of writing, this number is 12.9%, albeit the period ends with the trend heading upwards once again. It would appear that short sellers are convinced the company tie-up with Pendal is a leap too far for the fund manager. 4. Megaport (ASX: MP1) Shareholders of Megaport will be breathing a sigh of relief after December marked increase in short interest was wiped out, and then some, over recent weeks. Short interest in the tech company decreased by 120 basis points month-over-month, which is likely due to an improved performance from tech stocks to start the new year. On the other hand, the company cash flow remains a focal point for short sellers, with EBITDA proving no antidote for concerns about its investing outlay. 5. Sayona Mining (ASX: SYA) Completing an unchanged line-up among the top five, Sayona Mining was offered just a small reprieve over recent weeks, with aggregate short interest falling 50 basis points to 9.6% of all securities on issue. While a number of emerging and established battery metals names have started the year in strong fashion, that has tested the resolve of short sellers who largely appear keen to bet against the sector. There are currently three battery metals stocks among the top 10 most shorted names, and five in the top 20. Rank Company % Securities Reported as Sold Short Jan, 2022 Monthly Change 1 Flight Centre (ASX: FLT) 14.1% -0.5 2 BetMakers Tech (ASX: BET) 12.9% -0.2 3 Perpetual (ASX: PPT) 12.9% +0.2 4 Megaport (ASX: MP1) 10.1% -1.2 5 Sayona Mining (ASX: SYA) 9.6% -0.5 6 Core Lithium (ASX: CXO) 9.1% +1.1 7 Lake Resources (ASX: LKE) 7.7% -0.1 8 Breville Group (ASX: BRG) 7.1% -0.8 9 NextDC (ASX: NXT) 6.9% +0.3 10 Pointsbet (ASX: PBH) 6.8% +0.7 *Data is T+4, based on information reported to ASIC for January 19, 2023; rounded to one decimal Major Movers 1. Mayne Pharma Group (ASX: MYX) Pharmaceuticals company Mayne saw short interest in its shares drop from a high of 4.8% earlier this month, to just 0.5% over the space of a few days. However, it remains to be seen whether that was an anomaly, or signs of improving sentiment, with the company conducting capital management initiatives that resulted in the stock ticker changing to a deferred settlement code for several days. A special dividend and share consolidation were central to this program, with shares only resuming trade on a normal settlement basis on January 25. 2. Liontown Resources (ASX: LTR) It may be outside the top 10, but short interest in Liontown Resources has ballooned over recent weeks. Currently, 6.1% of all securities are sold short, up dramatically from 3.4% a month ago. Since that time, the company announced the departure of its CFO, a binding power purchase agreement for the supply of electricity to its Kathleen Valley Lithium Project, as well as a major cost overrun at said project. 3. Zip (ASX: ZIP) Shares in buy-now pay-later company, and former market darling, Zip, have gained ground over recent weeks. One of the potential reasons for the stock rise was the perceived resilience of consumer spending across the economy. This may have something to do with short sellers easing their bets against the stock, with aggregate short interest declining 220 basis points to 6.5% of all securities on issue. 4. 29Metals (ASX: 29M) You need to turn the clock back almost a month to the day to get a better picture as to why short interest in 29Metals is suddenly higher. The base metals miner released an operational update just before Christmas, indicating not only would copper production be flat year-over-year in 2023, but gold and silver production is expected to decline between 10-15% versus last year. Rising costs have also added to concerns, driving short interest up 170 basis points to 5.8% of all securities on issue. 5. PEXA Group (ASX: PXA) Short interest in property conveyancing company PEXA Group dropped quickly in the wake of corporate activity earlier this month. On January 10, the company announced the in-specie distribution of Link Administration (ASX: LNK) holdings in the firm. That led to Link shareholders receiving one PEXA share for every 7.52 Link shares they held, with Link also relinquishing its stake in PEXA as a result of the process." width="770" height="500" />

Key takeaways:

• Elevated short interest remains entrenched in a select number of stocks

• Strong gains for battery metals stocks have largely undeterred short sellers from sticking with their bearish' bets

With the ASX opening 2023 on a positive note, including 13 out of 15 trading sessions ending in the green, market sentiment has largely improved. In fact, the ASX has outperformed international peers, finding itself just a fraction off a fresh all-time high. That has played a role in overall short interest decreasing across the market, but some stocks find themselves unable to shake the tag.

Selfwealth does not offer short selling. Please note, data below is for information purposes and insights about sentiment, sourced from ASIC with a T+4 (4 trading day) delay. Individual short sellers report their short positions, so data is based on third-party input. There can be no guarantees regarding the accuracy of the data, and it should not be used as the basis for financial decisions.

Most Shorted ASX Stocks

1. Flight Centre (ASX: FLT)

Short sellers remain convinced that Flight Centre shares will decrease from here, with the stock still ranked as the most shorted ASX name at the start of 2023. Concerns about the economic outlook, not to mention the company margins, are just two of the catalysts behind persistent negative sentiment for the travel agency. With that said, short interest as a proportion of all securities is down this month by 50 basis points to 14.1%.

2. BetMakers Technology (ASX: BET)

While the local share market has rallied within touching distance of its all-time high this month, shares in BetMakers Technology continue to trade at their lowest level since May, 2020. Despite a modest decrease in short interest over the last month, the aggregate short position of the stock sees 12.9% of all securities currently sold short. That is down from a high of 16.6% back in May last year, but short interest grew 80% over the last 12 months.

3. Perpetual (ASX: PPT)

Fund manager Perpetual closed out its acquisition of Pendal, but short interest is showing no signs of materially decreasing. At one stage during January, aggregate short interest hit a new record of 14.0% of all securities. At the time of writing, this number is 12.9%, albeit the period ends with the trend heading upwards once again. It would appear that short sellers are convinced the company tie-up with Pendal is a leap too far for the fund manager.

4. Megaport (ASX: MP1)

Shareholders of Megaport will be breathing a sigh of relief after December marked increase in short interest was wiped out, and then some, over recent weeks. Short interest in the tech company decreased by 120 basis points month-over-month, which is likely due to an improved performance from tech stocks to start the new year. On the other hand, the company cash flow remains a focal point for short sellers, with EBITDA proving no antidote for concerns about its investing outlay.

5. Sayona Mining (ASX: SYA)

Completing an unchanged line-up among the top five, Sayona Mining was offered just a small reprieve over recent weeks, with aggregate short interest falling 50 basis points to 9.6% of all securities on issue. While a number of emerging and established battery metals names have started the year in strong fashion, that has tested the resolve of short sellers who largely appear keen to bet against the sector. There are currently three battery metals stocks among the top 10 most shorted names, and five in the top 20.

RankCompany% Securities Reported as Sold ShortJan, 2023Monthly Change1Flight Centre (ASX: FLT)14.1%-0.52BetMakers Tech (ASX: BET)12.9%-0.23Perpetual (ASX: PPT)12.9%+0.24Megaport (ASX: MP1)10.1%-1.25Sayona Mining (ASX: SYA)9.6%-0.56Core Lithium (ASX: CXO)9.1%+1.17Lake Resources (ASX: LKE)7.7%-0.18Breville Group (ASX: BRG)7.1%-0.89NextDC (ASX: NXT)6.9%+0.310Pointsbet (ASX: PBH)6.8%+0.7

*Data is T+4, based on information reported to ASIC for January 19, 2023; rounded to one decimal

Major Movers

1. Mayne Pharma Group (ASX: MYX)

Pharmaceuticals company Mayne saw short interest in its shares drop from a high of 4.8% earlier this month, to just 0.5% over the space of a few days. However, it remains to be seen whether that was an anomaly, or signs of improving sentiment, with the company conducting capital management initiatives that resulted in the stock ticker changing to a deferred settlement code for several days. A special dividend and share consolidation were central to this program, with shares only resuming trade on a normal settlement basis on January 25.

2. Liontown Resources (ASX: LTR)

It may be outside the top 10, but short interest in Liontown Resources has ballooned over recent weeks. Currently, 6.1% of all securities are sold short, up dramatically from 3.4% a month ago. Since that time, the company announced the departure of its CFO, a binding power purchase agreement for the supply of electricity to its Kathleen Valley Lithium Project, as well as a major cost overrun at said project.

3. Zip (ASX: ZIP)

Shares in buy-now pay-later company, and former market darling, Zip, have gained ground over recent weeks. One of the potential reasons for the stock rise was the perceived resilience of consumer spending across the economy. This may have something to do with short sellers easing their bets against the stock, with aggregate short interest declining 220 basis points to 6.5% of all securities on issue.

4. 29Metals (ASX: 29M)

You need to turn the clock back almost a month to the day to get a better picture as to why short interest in 29Metals is suddenly higher. The base metals miner released an operational update just before Christmas, indicating not only would copper production be flat year-over-year in 2023, but gold and silver production is expected to decline between 10-15% versus last year. Rising costs have also added to concerns, driving short interest up 170 basis points to 5.8% of all securities on issue.

5. PEXA Group (ASX: PXA)

Short interest in property conveyancing company PEXA Group dropped quickly in the wake of corporate activity earlier this month. On January 10, the company announced the in-specie distribution of Link Administration (ASX: LNK) holdings in the firm. That led to Link shareholders receiving one PEXA share for every 7.52 Link shares they held, with Link also relinquishing its stake in PEXA as a result of the process.