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Behavioural Finance
FOMO
Definition
Fear of missing out — the behavioural bias driving investors to chase rising prices. FOMO buying into a heavily-shorted stock can ignite a short squeeze as price-insensitive shorts get forced out.
Related Terms
Short Squeeze
A rapid increase in a stock's price caused by short sellers rushing to cover their positions. When many shorts try to buy shares simultaneously, it can drive the price up dramatically, forcing more shorts to cover.
Herding
The tendency of investors to follow the crowd rather than independent analysis. Herding amplifies trends and inflates bubbles, which contrarian short sellers seek to fade.
See short selling in action
Explore real-time ASIC short position data for ASX stocks.