The 10 Most Heavily-Shorted Stocks Of January 2021

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Short Sellers and the Most Shorted Stocks in January 2021

The Briefing

  • Retail brands, among others, have been the target of short-sellers amidst the COVID-19 pandemic
  • Individual investors have rallied behind a number of these stocks in an attempt to force a “short-squeeze”

Short Sellers Look to Profit from Struggling Companies

The prospects of retailers such as GameStop have deteriorated over the course of the COVID-19 pandemic, leading many hedge funds to bet against them by taking short positions.

Shorting a company involves borrowing its shares, selling them at current prices, and then buying them back in the future at what is hopefully a lower price. Essentially, short-sellers are betting that the company will underperform in the future.

The 10 Most Heavily-Shorted Stocks of January 2021

The following companies had the highest short interest as of January 29, 2021. Short interest is the % of a company’s shares that have been borrowed and sold, but not yet returned.

Company Short Interest (%) YTD Return (%) Sector
GameStop 121% 422% Consumer Discretionary
Dillards 95% 40% Consumer Discretionary
AMC Entertainment 79% 289% Communication Services
Virgin Galactic 72% 109% Industrials
fuboTV 72% 100% Communication Services
Bed Bath & Beyond 65% 41% Consumer Discretionary
Ligand Pharmaceuticals 65% 75% Health Care
National Beverage Corp. 63% 44% Consumer Staples
SunPower 58% 73% Technology
Tanger Factory Outlet Centers 52% 32% Real Estate

Source: YTD returns as of Feb. 2, 2021

Many of the companies on this list are brick-and-mortar based retailers that have struggled to attract business during COVID-19 lockdowns. This includes GameStopDillardsBed Bath & Beyond, and AMC Entertainment, America’s largest operator of movie theatres.

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Disclosure: This material has been distributed for informational purposes only. It is the opinion of the author and should not be considered as investment advice or a recommendation of any ...

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