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  • Writer's pictureRealFacts Editorial Team

S&P 500 Stocks with Lowest Short Interest in May


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Short selling is a financial strategy where an investor borrows shares of a stock and sells them on the open market, planning to buy them back later at a lower price. The investor profits if the stock price declines because they can repurchase the shares at the reduced price, return them to the lender, and pocket the difference. This technique is often used by traders who anticipate a drop in a stock's value, allowing them to benefit from the decline. However, this strategy carries significant risk because if the stock price increases, the potential losses can be unlimited. This is due to the fact that there is no limit to how high the stock price can rise. 


The short interest of a specific stock is frequently measured as “short interest as a percent of float”. This is a financial metric that measures the proportion of a company's outstanding shares available for trading (the float) that have been sold short. It is calculated by dividing the number of shares sold short by the total float and expresses the extent to which investors are betting against the stock. High short interest in a stock often indicates that a large number of investors are betting against it, anticipating its price will fall. This can also set the stage for a potential short squeeze, where a sudden increase in the stock's price forces short sellers to buy back shares to cover their positions, potentially driving the price even higher. 


On the other hand, low short interest in a stock generally suggests that investors are confident in the stock's prospects, with fewer expecting its price to decline. This can indicate a positive market sentiment and potentially lower volatility, as there is less pressure from short sellers. With this background into short selling, it's insightful to examine the top least shorted S&P 500 stocks for the month of May. The top three are Alphabet Class C (GOOG), Mastercard (MA), and Walmart (WMT). Each of these stocks had short interest of 0.5% of float or less, indicating strong investor confidence and positive market sentiment. The top twenty least shorted stocks in May, as reported by Seeking Alpha, are as follows:


Alphabet Inc C (GOOG) - Short interest as a % of float: 0.30%


Alphabet Inc A (GOOGL) - Short interest as a % of float: 0.44%


Mastercard (MA) - Short interest as a % of float: 0.48%


Walmart (WMT) - Short interest as a % of float: 0.50%


Northern Trust (NTRS) - Short interest as a % of float: 0.62%


L3Harris Technologies (LHX) - Short interest as a % of float: 0.62%


S&P Global (SPGI) - Short interest as a % of float: 0.63%


TE Connectivity (TEL) - Short interest as a % of float: 0.65%


Fortive (FTV) - Short interest as a % of float: 0.66%


Coca-Cola (KO) - Short interest as a % of float: 0.69%


Union Pacific (UNP) - Short interest as a % of float: 0.70%


Amazon.com (AMZN) - Short interest as a % of float: 0.71%


Eli Lilly & Co (LLY) - Short interest as a % of float: 0.72%


Norfolk Southern Corp (NSC) - Short interest as a % of float: 0.72%


General Dynamics (GD) - Short interest as a % of float: 0.72%


JPMorgan Chase & Co (JPM) - Short interest as a % of float: 0.73%


Chubb (CB) - Short interest as a % of float: 0.74%


Trimble (TRMB) - Short interest as a % of float: 0.74%

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