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The August edition of the Hazeltree Shortside Crowdedness Report lists the SPDR S&P 500 ETF (NYSEAECA: SPY) as the second most shorted security in the U.S. among hedge funds and alternative asset managers.

It is not the first time an S&P 500 ETF has been on the list of the 10 most shorted U.S. stocks, in fact, the SPDR S&P 500 ETF appeared on the list in both April and May. April was the month that the tariffs were introduced and the stock market tanked, initially, then bounced back and surged 6% higher in May after tariffs were paused.

Prior to that, the S&P 500 had never appeared on the Hazeltree list of most shorted stocks.

In August, a month where the S&P 500 hit an all-time high, more hedge fund managers were shorting the S&P 500 via the SPY ETF than they were in April or May. The SPY was the second most shorted stock with a crowdedness score of 90 on a scale of 1-99. The score represents securities that are being shorted by the highest percentage of funds in Hazeltree’s universe of more than 15,000 securities and 500 hedge funds.

With U.S. tariffs taking effect in August, we anticipated an uptick in global short selling and observed pronounced interest across consumer/luxury, transport, health care, and tech/semiconductors,” Tim Smith, managing director, data insights, at Hazeltree, said. “In the Americas, we also saw the re-emergence of the SPDR S&P 500 ETF among the top 10 shorted names during an up month for the S&P 500, along with increased short interest in Kraft Heinz ahead of the September corporate business split headlines.”

Live Nation and Super Micro Computer top the list

With markets skyrocketing since the April crash to all-time highs, many investors have expressed concerns about the high valuations of stocks and are warning about a bubble created by AI stocks. The movements of hedge fund managers tracked by Hazeltree could be in response to short-term concerns about the overall high valuation of the S&P 500.

Currently the P/E ratio of the S&P 500 is 30, which is above average. The inflation-adjusted Shiller P/E ratio is 39, which is the highest since 2021.  

There are some tech names among the top 10 most shorted large-caps, including Super Micro Computer (Nasdaq: SMCI), which makes AI servers and data storage solutions. It joined concert promoter Live Nation (NYSE: LYV) as the most shorted large cap in August.

• Live Nation – 99
• Super Micro Computer – 99
• SPDR S&P 500 ETF – 90
• Kraft Heinz – 90
• Charter Communications – 90
• Advanced Micro Devices (AMD) – 87
• IBM – 84
• Air Products and Chemicals – 84
• Marriott International – 84
• Cloudflare — 84

Among midcap stocks, Hims & Hers Health (NYSE: HIMS) was the most shorted stock with a score of 99. Winsgtop (Nasdaq: WING) was next with a score of 90.

In the small-cap category, Amphastar Pharmaceuticals (Nasdaq: AMPH) was the most shorted security with a score of 99. PAR Technology (NYSE: PAR) and Allegiant Travel were next with scores of 94.

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