Short interest in S&P 500 shoots up ahead of Fed
Investors are shorting companies in the S&P 500 at a level last seen in 2011, when the European debt crisis dominated headlines.
Average short interest of the S&P 500 has broken above 2.5 per cent for the first time in more than three years, says Markit. The financial data provider said average short interest is 2.85 per cent of shares, the most since September 2011, writes Patrick McGee.
"The recent surge in short interest comes on the heels of a four-year equity super cycle that saw short sellers retreat to the post Lehman lows seen in the middle of last year," Markit said. (see the chart below).
Markit notes the increase in shorting began in energy names, but short-sellers have more recently taken an interest in a broader array of companies, causing a "violent rise".
Over the past three months, three-quarters of the 500 companies have seen short positions grow. Chief among them is Mattel, the maker of Barbie dolls, where short interest has risen more than 10 percentage points to 18 per cent of shares outstanding on loan. Mattel shares have lost a quarter of their value this year.
The figures highlight jitters investors are feeling as China slows down and the Fed considers lifting interest rates. While these charts below don't officially make our#chartforJanet list, they deserve an honourary mention.
