Tesla, Amazon, Apple were the most profitable shorted stocks in June

Yahoo Finance’s Alexandra Semenova joins the Live show to discuss the leading shorted stocks for the month of June.

Video transcript

[MUSIC PLAYING]

JARED BLIKRE: Welcome back. Some of the biggest names in tech, such as Tesla, Amazon, and Apple, they led the most shorted stocks in June. But with short interest declining, could this be a sign that short sellers think we have hit a market bottom? And I think that's the most important question for investors. We have Yahoo Finance's Alexandra Semenova here to break it all down. Do we have that much needed bottom?

ALEXANDRA SEMENOVA: Well, I guess we'll see, Jared. Last year, some of these hypergrowth tech names were leading the market rally, and this year, they're winners, too, but among short sellers. According to a new report from S3 Partners, traders betting against mega-cap names, including Amazon, Apple, Tesla, made about $20 billion in profits through June 30th. That's, of course, thanks to the tremendous rout that we have seen in these technology names.

And this is a long time coming for short sellers who have been betting against the mega-caps. The same report actually found that they lost about $36 billion in the prior two years, hoping that this crash would come sooner. But of course, we saw during the pandemic and last year these prices just swelled to all-time highs.

JARED BLIKRE: Yeah, shorting at the beginning of last year was not the thing to do. But it looks like some short sellers are still making profits, but the data shows short interest declined in June. And what is that telling us right now?

ALEXANDRA SEMENOVA: Yeah, I mean, it's been a very lucrative year for short sellers. They're sitting about 300-- on about $300 billion in profits in the first half of the year, and they've been consistently ramping up their bets against the market up until May. But June actually saw short interest decline, which suggests that short sellers are comfortable with where they are and they're not looking to push their luck, essentially anticipating that a market rally may be near and anticipating that perhaps stocks have found a bottom.

JARED BLIKRE: And maybe it's a rally, maybe it's a bear market rally. We'll have to see. Yahoo Finance's Alex Semenova, thank you for joining us.