Top 10 most shorted stocks in the UK
Many traders seek out struggling companies and short their stocks in the hopes of making a profit if share prices fall. Here, we unpack the most shorted stocks in the UK and explain how you can trade them.
How to trade the UK's most shorted stocks
To trade any of the stocks on the ‘UK’s most shorted stocks’ list, you can open a position using a spread bet or contract for difference (CFD). When you go short, you’re speculating that the price of an asset will go down – and if you’re right, you’ll make a profit. If the share price rises, the market is moving against you, which will result in a loss.
If you want to short-sell, you can either use derivative products such as spread bets and CFDs or borrow the stock from a share dealing broker. With us, you’ll use these financial derivatives with leverage – which means that you’ll only need a small deposit, known as margin, to gain full exposure. While your initial outlay is decreased significantly, both your potential profits and possible losses are magnified to the full value of your trade.
That’s why it’s important to manage your risk properly. Further, using derivative products mean you don’t own the underlying shares – you’re simply speculating on their price movements. If you borrow the shares, you’ll aim to sell them, then buy them back at a lower price in the hopes of making a profit. Whether you make the profit or not, you’ll have an obligation to return the borrowed shares to the broker.
Most shorted stocks in the UK
- ITM Power (2.91% short)
- Petrofac (2.45% short)
- AFC Energy (2.21% short)
- Burberry (2.03% short)
- Ocado (2.00% short)
- Renewi (1.98% short)
- FD Technologies (1.96% short)
- abrdn (1.95% short)
- SIG (1.81% short)
- Hargreaves Lansdown (1.78% short)
The following shares were chosen as the 10 most shorted stocks in the UK by descending order of their percentage weighting for being sold on the market from FCA data.1 Note that the most shorted stocks in the UK change daily due to normal market fluctuations. For the most recent data, you can visit the FCA short tracker.2
ITM Power (2.91% short)
ITM Power is a tech giant that manufactures energy storage as well as clean fuel solutions. The company owns the world’s largest electrolyser factory, based in Sheffield, England. It also specialises in hydrogen-based clean energy solutions.
The shares are down 19% over the past 12 months and have halved since July 2023. However, a turnaround is underway at the company. Half-year revenues more than quadrupled to £8.9 million (from £2 million in 2023), while EBITDA (earnings before interest, tax, depreciation and amortisation) more than halved to £21 million (from £54 million in 2023).
Petrofac (2.45% short)
Petrofac is an energy services company, which operates in the oil and gas industry and also the offshore wind sector.
The shares have almost halved over the past 12 months after the company pleaded guilty to bribery offences and was hit by a £77 million fine from the Serious Fraud Office. As well as attracting shorting activity, this has also affected the company's ability to bid on new contracts. It was banned from doing so in Saudi Arabia, Iraq and the United Arab Emirates, although the ban in the UAE has since been lifted.
AFC Energy (2.21% short)
AFC Energy develops fuel cell and fuel processing technology, providing hydrogen fuel cells and hydrogen carrier fuel conversion products to customers in the construction, electric vehicle (EV) charging, shipping and data centre industries.
The shares are up 16% this year. However, the company is loss-making and in 2023 full year losses after tax rose to £17.5 million from £16.4 million in 2022. AFC Energy made £200,000 in revenues, down from £600,000 in 2022. However, the company says its order book now stands at £27 million.
Burberry (2.03% short)
Shares in iconic clothing retailer Burberry slumped in January 2024 after the company issued a profits warning, revealing that profits would miss analysts' expectations. The shares have more than halved over the year.
A number of major players in the luxury clothing and accessories markets are struggling with a fall in demand for their products due to the cost of living crisis. Recent full-year results from Burberry revealed that pre-tax profits had almost halved to £383 million from £634 million in 2022 and that the US and Asian markets remained challenging.
Ocado group (2.00% short)
Ocado group is an online grocery retail business headquartered in Britain and listed on the London Stock Exchange (LSE). The company entered a joint venture with Marks & Spencer in February 2019, ceding 50% of its UK retail business, Ocado.com.
The company continues to be loss-making, although its UK retail business is now profitable. In 2023, Ocado Group posted a pre-tax group loss of £393.6 million, down from £500.8 million in 2022. To date, Ocado has been unprofitable and is forecasted to remain so for the next couple of years. This makes Ocado a target for short sellers.
Renewi (1.98% short)
Renewi is a waste disposal business which was created in 2017, following the merger of Shanks with Van Gansewinkel Groep BV, and is listed on the London and Amsterdam Stock Exchanges. It specialises in recycling waste into new products, such as paper, glass, construction materials and compost.
The company rejected a takeover bid by private equity company Macquarie in October 2023 at 775p and the shares fell 22%.
Half year pre-tax profits fell by 36% to €45.4 million (from €71.6 million in 2023), while revenues fell by 2% to €937.1 million from €952 million in the same period in 2023. Net debt also increased to €383.2m
(from €370.6m in March 2023), in line with expectations. However, net cash inflow from operating activities rose to €88.8 million from €74.0 million last year due to improvements in working capital, the company said.
FD Technologies (1.96% short)
Aim-quoted FD Technologies is the umbrella for a group of data provision and analysis businesses, which provide software and consulting services to sectors including finance, technology, manufacturing, pharmaceuticals and energy. Its businesses include data capture firm KX, MRP and capital markets data company First Derivative.
The shares are down 31% this year. FD Technologies made losses of £4.5 million for the half year to 31 August 2023, after making a £1.1 million pre-tax profit last year. Revenues fell 3% to £142.5 million from £147.4 million in 2022. While data capture company KX is performing well, with recurring revenues up 23%, First Derivative saw revenues fall 1%.
abrdn (1.95% short)
abrdn is the company formerly known as Standard Life Aberdeen. The fund management firm has had much fun poked at it by the press for the rebranding of its name and the resultant lack of vowels.
The shares are down 27% over the past 12 months as the fund manager has been hit by market net outflows due to the volatile stock market. In the full year 2023, net outflows increased by 35% to £13.9 billion (from £10.3 billion in 2022).
The company also recently acquired financial publisher Interactive Investor. Some commentators think the company should consider a break-up of the group. Nevertheless, the dividend yield offers attractions at 9.5%.
SIG (1.81% short)
SIG supplies specialist insulation and sustainable building products across Europe. The company is based in London and is the leading provider of roofing and exterior products in the UK and France.
SIG has been struggling amid the wider downturn in the construction industry. As such, the shares are down 31% over the last 12 months. The company said its recent results "reflect continuing challenging market conditions". Indeed, like-for-like sales fell 6% to £873 million, reflecting "both volume and price reductions," management said. Meanwhile, SIG is busy cutting costs and making productivity improvements.
Hargreaves Lansdown (1.78% short)
Like abrdn, fellow financial Hargreaves Lansdown has been feeling the pain of the cost of living crisis, geopolitical events and vagaries of the stock market. At the half year results, net new business at the asset manager fell by 38% to £1 billion and interim revenues rose mainly down to the interest earned on client savings.
However, the recent third quarter figures paint a healthier picture, with share dealings up slightly a month to 794,000 (from 770,000 in the same period last year), net new clients of 34,000 in the quarter (from 23,000 in the same period in 2023), and net new business of £1.6 billion - flat on the same quarter last year but an improvement on the half-year figures.
Short-selling stock examples
Let’s look at a few short-selling examples, to see how you can use this strategy to try and profit from a company’s falling share price.
Shorting stock with spread bets example
If you choose spread betting, you’re simply betting on the direction in which the market will move. Say XYZ shares are trading at $68.5, with a sell price of $68.45 and a buy price of $68.55. You think the XYZ share price will fall, so you go short at $50 per point of movement at the sell price of $68.45.
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If the share price goes down
Let’s say the market moves in your favour after two weeks, and the share price drops to $60.5 with a sell price of $60.45 and a buy price of $60.55. You decide to close your trade, and get $50 for every point the price moved down – which means you’d have made $395 in profit ([$68.45 – $60.55] x $50).
With spread betting, you won’t have to pay any tax on your profits, or commission to open the position. However, you’ll have to pay funding charges if you keep your position open overnight.
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If the share price goes up
If the XYZ share price moves against you – in other words, it goes up – you’ll lose $50 for every point the market moves against you. Assume the new share price is $71.5 after two weeks, with a sell price of $71.45 and a buy price of $71.55. If you close the trade at the new buy price, you’ll incur a loss of $155 ([$68.45 - $71.55] x $50), plus any overnight funding charges.
Shorting stock with CFDs example
If you choose CFD trading, you’ll be exchanging the difference in price of the stock from when the position is opened to when it is closed. Let’s say the underlying market price of XYZ shares is $68.5 a share, with a sell price of $68.45 and a buy price of $68.55. You decide to short sell 100 shares.
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If the share price goes down
If the share price moves in your favour after two weeks and goes down to an underlying price of $60.5, with a sell price of $60.45 and a buy price of $60.55, you’d stand to profit. Suppose you decide it’s time to reverse the trade, so you buy the shares at the new price of $60.55. Your profit on this trade will be calculated as ([$68.45 – $60.55] x 100), which equals $790.
Note that you’ll also need to pay a commission fee, any overnight funding charges, and capital gains tax on your profits.
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If the share price goes up
Let’s assume that the market has moved against you after two weeks and is now trading at $71.5 with a sell price of $71.45 and a buy price of $71.55. You decide to close your position. The calculation of your loss is ([$68.45 – $71.55] x 100), which gives you a loss of $310, in addition to your commission fee, and any overnight charges.
How to use shorting data
You can use shorting data – the details surrounding the most shorted stocks – to identify the companies in which investors have the least confidence. This should be an indication that markets aren’t doing well and share prices might fall – or continue to fall. Ensure you carry out thorough technical and fundamental analysis, including shorting data, before deciding to buy or sell shares.
Open an account to start trading today
How to short stocks with us
1. Learn more about shorting stocks
2. Open an account with us or practise on a demo
3. Select your opportunity
4. Choose your position size and manage your risk
5. Place your deal and monitor your trade
You can trade using spread betting or CFDs to benefit from leverage.
Keep in mind, leverage means you can gain or lose money faster than expected. Because your position size is far greater than your deposit, you could lose more money than you put in. Be aware also that past performance is not an indicator of future returns.
Learn more about the differences between trading and investing here.
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