According to the latest FCA data, Anglo American remains one of the most shorted stocks in the UK. This is surprising because the entire sector is actually rising.
Look at AAL’s price chart below. Prices found support at 1,900p to re-test its 2019 highs (see below). Given that BHP and Rio Tinto are already establishing new price highs for the year, an upside breakout here is possible. So will the short sellers continue to defend their positions here? May be – but it will come at a cost.
Another stock targeted by the bears but is appreciating is Greencore (GNC). Prices have rebounded about 10% from its recent lows. A further rally may jolt the bears.
For the rest, like Kier (KIE) and Babcock (BAB), they remain weak. The former slumped to 103p just recently, thus bring its 52-week performance to a dismal -88%! Kier’s shareholders equity is crushed by the firm’s significant debt. At this rate of decline, we are looking at sub-100p soon.
For Wood Group, a counter-trend rebound is underway despite being heavily shorted. In total, 11 funds are holding net-short positions here. WG’s recent bullish gap up could be a signal that a further rebound is on the table. The near-term upside target noted at 480-500p. Whether this rally will prompt the bears to reduce remains a question mark.
Good Money Guide Featured Providers
|Trading||Investing||Spread Betting||Currency Transfers||CFDs|
|Visit IG||Visit HL||Visit ETX Capital||Compare Quotes||Visit CMC Markets|
Looking for an institutional broker? Compare prime brokers here
Jackson has over 10 years experience as a financial analyst. Previously a director of Stockcube Research as head of Investors Intelligence providing market timing advice and research to some of the world largest institutions and hedge funds.
Expertise: Global macroeconomic investment strategy, statistical backtesting, asset allocation, and cross-asset research.
Jackson has a PhD in Finance from Durham University.