Weatherford International’s short interest
Weatherford International’s (WFT) short interest as a percentage of its float was 7.6% as of July 8, 2016, compared to 5.3% on March 31. Since the end of 1Q16, WFT’s short interest has risen by 46%.
As noted in the graph above, WFT’s share price and short interest as percentages of float have been inversely related in the past three years. WFT makes up 0.03% of the iShares MSCI ACWI Low Carbon Target ETF (CRBN).
Short interest and share price
Short interest is the number of shares sold short divided by the number of shares outstanding. A fall in short interest as a percentage of float, or a fall in short interest, indicates that fewer investors expect a stock’s price to fall.
WFT’s stock price has fallen by 30% since March 31, reflecting a rise in its short interest. Since March 31, WFT’s smaller market capitalization peer Oil States International’s (OIS) share price has fallen by 1%.
Investors should note that the Market could go against investors’ sentiments. The stock’s price could rise when investors start buying the stock to cover their short positions.