How to Find & Trade High Short Interest (Squeeze) Stocks

Short interest is the total number of outstanding shares sold short.

Our data suggests short-sell traders should look for a high short interest float over 6% and a short interest ratio (coverage) greater than 19 days to find highly profitable short squeeze scenarios.

This guide will help you understand how short interest works, the strategies traders use to profit from it, and how to find and trade short-interest stocks.

What is short interest?

Short interest is the total number of shares sold short. Traders watch the short interest percentage closely because a high percentage of shares sold short could lead to a highly profitable short squeeze scenario. Any stock with a short interest percentage higher than 5.9% is in the 90th percentile of shorted stocks and is a short squeeze candidate.

Short interest explained

Short interest is the number of shares sold short by investors. The percentage of shares sold short indicates how bullish or bearish investors are on a particular stock. For example, if there are many short sellers, this could indicate that they believe the stock price will fall in the future. Conversely, if there are very few short sellers, this could indicate that they believe the stock price will rise.

When investors sell a stock short, they borrow shares from a brokerage firm and sell them in the open market. If the stock price drops, the investor can buy back the shares at a lower price and profit from their trade. The higher the short interest, the more pessimistic investors are on a particular stock.

What does short interest float mean?

A short interest float is the number of shares borrowed and shorted as a percent of the outstanding publicly traded shares. Short interest float is another name for short interest percent.

Float refers to the number of shares that are available for trading. A high float means more shares are available for trading, making it easier for buyers and sellers to trade without impacting the stock price. A low float means fewer shares are available for trading, making it more difficult to trade without impacting the stock price.

What is the short interest percentage?

The short interest percentage is another name for short interest percent float; it’s the number of shares sold short divided by the total number of shares outstanding. Watch the short interest percent because it indicates how many investors are bearish on a particular stock. For example, if the short interest percentage is high, this could indicate that many investors believe that the stock price will fall in the future.

Short Interest % Float Calculation

Short Interest Percent = # shares sold short / #of shares outstanding

What is the short-interest ratio?

The short interest ratio, or the days to cover, is a useful market sentiment indicator. It reveals the number of days the current short sellers would take to cover their positions if there were no new short sellers.

Covering positions means buying back the shares they have borrowed for shorting purposes. For example, if the short interest ratio is high, it would take longer for a short seller to buy back shares at the current average trading volume; this is to the advantage of bulls when a short squeeze is in motion.

This metric indicates the level of bearishness on a stock. A high short-interest ratio suggests more investors are bearish on a particular stock than bullish ones.

Short Interest Ratio Calculation

Short Interest Ratio = Short Interest % / Financial Trading Volume

This ratio is calculated by dividing the short interest percentage (the total number of shares sold short divided by the total outstanding shares) by the financial trading volume (the number of shares traded during a given period). The higher this ratio, the more bearish investors are on the stock.

Using short interest and days to cover together

When examining short-selling activity, the short interest percentage float and short interest ratio (days to cover) must be considered. If both the short interest percent and the days to cover are high, this indicates a high level of bearishness on the stock and, therefore, a short squeeze scenario.

High Short Interest % + High Days to Cover = Short Squeeze Potential

What is a short squeeze?

A short squeeze occurs when traders drive a stock price up, squeezing short sellers into a large loss situation. The short sellers have to scramble to buy the stocks back (cover) at a loss to avoid losing even more money. This covering causes the stock price demand to catapult higher, meaning good profits for the traders.

What is a high short interest?

A stock with high short interest is one with at least 6% of shares sold short by investors. This data is important because it can indicate how bearish or bullish investors are on a particular stock. For example, if the short interest is high, it could indicate that many investors believe that the stock price will fall in the future.

What is considered a high short interest?

Most investors consider a high short interest greater than 5%, but our data suggest that the 90th percentile of US stocks has a short interest of >5.7%. This means the highest shorted 10% of US stocks have a short interest of 5.7% or more.

NYSE & NASDAQ Stocks Short Interest Percent

Table 1: Short Interest Percentile Distribution 4138 Nasdaq & NYSE Stocks – Researched by Liberated Stock Trader using Stock Rover

What is the average short interest in a stock?

According to our research, the median average short interest in a stock is 2% across the 4,138 largest capitalized companies on the Nasdaq and NYSE. (See Table 1 above)

Chart: Short Interest % vs. Short Interest Ratio Distribution

What is high short-interest coverage?

Our research shows that high short-interest coverage is anything longer than 10 days, but the top 10% of short-interest coverage companies are more than 19 days.

The data in Chart 1 shows that when broken into percentiles and medians, the top 10% of companies with a high short interest ratio are above 19 days. The Median short interest coverage is 4.8 days, and the lowest 10% of stocks have coverage of 1.8 days.

NYSE & NASDAQ Stocks Short Interest Ratio/Coverage

The median average short interest coverage of 4,138 stocks on the NYSE and Nasdaq is 4.8 days. The longest short-interest ratio in the 90th percentile is 19.3 days.

Table 2: Short Interest Percentile Distribution on 4138 Nasdaq & NYSE Stocks – Researched by Liberated Stock Trader using Stock Rover

4 Best ways to find a stock’s short interest?

1. Use Finviz to find a stock’s short interest

To see a stock’s short interest, visit Finviz, type in the stock ticker, and review the Short Float and Short Ratio fields. (See image below.)

Alternatively, you can see all stocks on Finviz with a float short > 20% here.

View All High Short Interest Stocks on FinViz

2. Use Stock Rover to scan for short-interest

Stock Rover allows scanning the entire US stock market for short float percentages and short interest ratios. Select New Screener -> Criteria Short % float> 20%.

The image below shows the depth of short trading screening possible, 4,500 stocks to be exact.

Register for free with Stock Rover and import this screener code to get a complete list of stocks in the USA with a short interest ratio and short interest percent.

Stock Rover Screen 1.0
Short
{“description”:””}
{“name”:” Short”,” filterData”:[{“data”:[],” field”:” short_pct”,” excluded”:false},{“data”:{},” field”:” short_interest_ratio”,” excluded”:false},{“data” :{ “type”:” list”,” value” :[ “NA”,” NY”]},” field”:” exchange”,” excluded”:false},{“data”:[],” field”:” cap”,” excluded”:false}],” description”:””,” equityType”:” Stock”,” limit” :0,” universe”:3}
*===================================================*

Short

Criteria:
Short Interest Ratio
Exchange: NASDAQ, NYSE

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3. Visit Barron’s to see short interest information

Barron’s provides a simple way to see the short interest for a stock. Here is a link to the Barron’s page for Tesla, where you can see the company’s short interest information.

4. Other ways to find short-interest data

There are several different ways to find a stock’s short interest. One is to look at the major exchanges that it trades on. The New York Stock Exchange (NYSE) and Nasdaq have websites where you can view this information. Another is through online brokers such as E*TRADE and Charles Schwab. Finally, you can find this information from financial news websites such as Yahoo! Finance and CNBC.

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Is high short interest good or bad?

A high short interest is good for short sellers as it indicates a potential profit if the stock price falls. If the short interest percent and coverage are too high and a short squeeze occurs, it is bad for short sellers, forcing them to cover positions and take losses.

A high short interest is a good thing for investors because it indicates a lot of bearish investors in the market. This could indicate that the stock price will fall and that there could be a buying opportunity. Other investors believe that high short interest is bad because it indicates that many are betting against the stock. This could indicate that the stock price will fall and that you should avoid the stock.

Finding stocks with the highest short interest

The quickest way to find stocks with high short interest is to use the Finviz stock screener; this link will jump straight to a list of high short-interest stocks. Alternatively, follow this easy 4-step process.

4 Steps to Find High Short Interest Stocks Using Finviz

1. Visit Finviz and click on Screener
2. Select Descriptive Filters
3. Select Float Short > 20%
4. Select Charts

View All High Short Interest Stocks on FinViz

Quick Links to the Highest Short Interest Stocks on Finviz

• AMC Short Interest
• GME Short Interest
• Tesla Short Interest

How to calculate short interest

To calculate short interest, you need to divide the number of shares sold short by the total number of shares outstanding. This data helps you understand how bearish or bullish investors are on a particular stock. For example, if the short interest is high, this could indicate that many investors believe that the stock price will fall in the future.

How often is short interest reported?

Short interest is reported on a bi-weekly basis by the exchanges. This means you will see updated information on how many shares have been sold short by investors every two weeks. For example, if the short interest is high, this could indicate that many investors believe that the stock price will fall in the future.

When is short interest reported?

Short interest report dates vary from month to month. The NYSE and Nasdaq typically disseminate short interest reports between the 9th-12th and 24th-27th days of every month. Further details on short-interest reporting data are found on the FINRA website.

How does short interest affect stock price?

Short interest can have a big impact on a stock’s price. When many investors are shorting a stock, it can pressure the stock price and cause it to fall. Conversely, when many investors buy a heavily shorted stock, it can pressure the stock price and cause it to rise; this is called a short squeeze.

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What is a short squeeze?

A short squeeze is when many investors buy a heavily shorted stock, which puts pressure on the stock price and causes it to rise. This is called a short squeeze because the shorts (investors who are betting against the stock) are getting squeezed out of their positions.

How can short interest exceed 100?

It is rare, but short interest can exceed 100% when many investors are betting against a stock and the number of shares sold short exceeds the number of shares outstanding. This can happen because naked short sellers do not borrow the stock; they sell it without owning it.

Which stocks have a short interest over 100%

Currently, there are no shortable stocks in the USA with a short interest of over 100%. The highest short-interest stocks are Fisker Inc. at 42%, Carvana Co. at 40%, and Edible Garden AG Inc. at 39%.

List of the Highest Short-Interest Stocks

The highest short-interest stocks are Fisker Inc., Carvana Co., Edible Garden AG Inc., Axcella Health Inc., and Beyond Meat Inc., each with a float short of over 35%.

View All High Short Interest Stocks on FinViz

Tesla short interest

Tesla is a popular stock that traders look to short sell or put pressure on a short squeeze. We can see on Finviz that a short squeeze is not a real possibility with Tesla, as the short float and short ratio are too small.

See Tesla’s Short Interest on Finviz

AMC short interest

While the Reddit investors continue to play short-squeeze opportunities, Barrons reports a short interest float of 18%.

See AMC’s Short Interest on Finviz

GME short interest

Gamestop is still in an interesting short squeeze opportunity category with a short float of 23% and a short ratio of 4.51.

See GameStop’s Short Interest on Finviz

Short interest measures how many shares of a particular stock have been sold short by investors. It can gauge investor sentiment on a particular stock and provide insight into whether investors believe the stock price will go up or down in the future. A high short-interest ratio indicates that many investors believe the stock price will fall. In contrast, a low short-interest ratio indicates that many investors believe the stock price will increase. Short interest is typically reported bi-weekly.

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