What is a high short interest percentage?

Generally, short interest above 10% is considered elevated, above 20% is very high, and above 30% is extreme. However, context matters - some sectors like mining typically have higher short interest than defensive sectors.

Does high short interest mean a stock will go down?

Not necessarily. High short interest indicates bearish sentiment, but it can also lead to short squeezes if positive news emerges. Some investors see high short interest as a contrarian bullish indicator.

How to Read Short Interest Data

Understanding Short Interest Metrics

Short interest is expressed as a percentage of total shares on issue. On Shorted.com.au, you'll see several key metrics for each stock.

Current Short Position %

This is the percentage of total issued shares currently held as short positions. For example, if a company has 100 million shares on issue and 10 million are shorted, the short interest is 10%.

Change Over Time

Tracking how short interest changes over days, weeks, and months reveals sentiment trends. Rising short interest suggests increasing bearishness; falling short interest suggests shorts are covering.

Interpreting Short Interest Levels

0-5%: Low short interest, typical for defensive stocks
5-10%: Moderate short interest, normal range
10-20%: Elevated, significant bearish sentiment
20%+: Very high, potential squeeze candidate

What High Short Interest Tells You

High short interest can indicate several things:

Professional investors believe the stock is overvalued
There may be undisclosed problems at the company
The stock faces headwinds (sector, economic, competitive)
The stock is potentially a short squeeze candidate

Using Short Interest in Your Analysis

Never rely on short interest alone. Combine it with fundamental analysis, technical indicators, and news flow for a complete picture. Short sellers are often wrong, and high short interest can be a contrarian bullish signal when combined with positive catalysts.