What’s Happened to WFT’s Short Interest since 1Q16?



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).

Article continues below advertisement

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.


More From Market Realist