Datastream

The 10 Most Heavily-Shorted Stocks of January 2021

Published

2 years ago

February 4, 2021

Marcus Lu

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 GameStop, Dillards, Bed Bath & Beyond, and AMC Entertainment, America’s largest operator of movie theatres.

Short sellers have also targeted Tanger Factory Outlet Centers for similar reasons. The mall operator’s revenues fell to $64 million in Q3 2020, a 45% drop from the same quarter in 2019. The expectation that a quarter of U.S. malls will close by 2025 could also be a factor for the company’s high short interest.

Retail Investors Clash with Short Sellers

If these companies are expected to fail, why are their share prices making double, and sometimes triple-digit gains? The answer is a phenomenon known as the “short squeeze”.

In an unprecedented move, retail investors have banded together to buy millions of dollars worth of shares to push these companies’ stock prices up, rather than down.

This has forced short sellers to repurchase the shares that they previously borrowed (and sold) at a much higher price. This places even greater upward pressure on the stock, and can result in the triple-digit gains seen in the case of GameStop.

Where does this data come from?

Source: FactSet
Notes: Short interest data as of January 29, 2020. YTD returns as of Feb. 2, 2021.

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Economy

Charted: Public Trust in the Federal Reserve

Public trust in the Federal Reserve chair has hit its lowest point in 20 years. Get the details in this infographic.

Published

6 days ago

May 23, 2023

Marcus Lu

The Briefing

Gallup conducts an annual poll to gauge the U.S. public’s trust in the Federal Reserve
After rising during the COVID-19 pandemic, public trust has fallen to a 20-year low

Charted: Public Trust in the Federal Reserve

Each year, Gallup conducts a survey of American adults on various economic topics, including the country’s central bank, the Federal Reserve.

More specifically, respondents are asked how much confidence they have in the current Fed chairman to do or recommend the right thing for the U.S. economy. We’ve visualized these results from 2001 to 2023 to see how confidence levels have changed over time.

Methodology and Results

The data used in this infographic is also listed in the table below. Percentages reflect the share of respondents that have either a “great deal” or “fair amount” of confidence.

Year	Fed chair	% Great deal or Fair amount
2023	Jerome Powell	36%
2022	Jerome Powell	43%
2021	Jerome Powell	55%
2020	Jerome Powell	58%
2019	Jerome Powell	50%
2018	Jerome Powell	45%
2017	Janet Yellen	45%
2016	Janet Yellen	38%
2015	Janet Yellen	42%
2014	Janet Yellen	37%
2013	Ben Bernanke	42%
2012	Ben Bernanke	39%
2011	Ben Bernanke	41%
2010	Ben Bernanke	44%
2009	Ben Bernanke	49%
2008	Ben Bernanke	47%
2007	Ben Bernanke	50%
2006	Ben Bernanke	41%
2005	Alan Greenspan	56%
2004	Alan Greenspan	61%
2003	Alan Greenspan	65%
2002	Alan Greenspan	69%
2001	Alan Greenspan	74%

Data for 2023 collected April 3-25, with this statement put to respondents: “Please tell me how much confidence you have [in the Fed chair] to recommend the right thing for the economy.”

We can see that trust in the Federal Reserve has fluctuated significantly in recent years.

For example, under Alan Greenspan, trust was initially high due to the relative stability of the economy. The burst of the dotcom bubble—which some attribute to Greenspan’s easy credit policies—resulted in a sharp decline.

On the flip side, public confidence spiked during the COVID-19 pandemic. This was likely due to Jerome Powell’s decisive actions to provide support to the U.S. economy throughout the crisis.

Measures implemented by the Fed include bringing interest rates to near zero, quantitative easing (buying government bonds with newly-printed money), and emergency lending programs to businesses.

Confidence Now on the Decline

After peaking at 58%, those with a “great deal” or “fair amount” of trust in the Fed chair have tumbled to 36%, the lowest number in 20 years.

This is likely due to Powell’s hard stance on fighting post-pandemic inflation, which has involved raising interest rates at an incredible speed. While these rate hikes may be necessary, they also have many adverse effects:

Negative impact on the stock market
Increases the burden for those with variable-rate debts
Makes mortgages and home buying less affordable

Higher rates have also prompted many U.S. tech companies to shrink their workforces, and have been a factor in the regional banking crisis, including the collapse of Silicon Valley Bank.

Where does this data come from?

Source: Gallup (2023)

Data Notes: Results are based on telephone interviews conducted April 3-25, 2023, with a random sample of –1,013—adults, ages 18+, living in all 50 U.S. states and the District of Columbia. For results based on this sample of national adults, the margin of sampling error is ±4 percentage points at the 95% confidence level. See source for details.