It has been a difficult start for 2025 for traders to bet against stocks.
Short sellers, who bet on stock prices to fall, have lost $ 73 billion between US and Canadian markets to start 2025, according to data from S3 partners provided to Yahoo Finance.
“The rally in the market was not kind with short sellers,” the head of predictive analyst S3, Ihor Dusaniwsky, told Yahoo Finance.
The S&P 500 (^Gspc) Raised by about 4% this year, but many companies in the index have increased to the higher, some partly due to short pressures. Super Micro computer (Smi), the best performer in this year's index, now up more than 110% since the beginning of 2025. Short sellers have lost more than $ 2.2 billion as the stock runs up.
A short squeeze occurs when a sufficient number of investors have bet against stock to go down. If instead of the stock rallies, those traders are forced to buy the stock to cover their site and in turn send shares even higher. A short squeeze was the Meme Stock Mania's leading drive in 2021 When Gamestop's shares rose to more than 134% in one day.
“This is the thing about short sellers I think is being forgotten,” wrote the main marker of Star JC Parets Star Chart Markets in a note on Monday. “Short sellers are sure of future buyers … when shorts are squeezed, these may come exaggerated Dissolution. “
And the market has seen plenty of those who are forcing dissolution this year. S3 Partners uses a model to characterize how “pressable” is stock, with a “squeeze score” reading over 70 indicating that stock is open to a short squeeze and a reading of 90 signifies The stock is “highly vulnerable” to crunch. Currently Micro Computer Super Reading is 100.
Although perhaps the highest high -profile micro is far from the only stock that big jumps are seen due to short pressures so far this year. Hims & Hers Health (Hims) It also has a reading of 100 on S3 squeeze score, while Oklo (Ok), Play a popular nuclear AI, and Bigbear.ai (Boss) above 70. The three stocks have increased 80% or more this year.
On Wednesday, HIMS stock added another 22% to its total year to day after the health and wellness platform said he was planning to present laboratory tests at home through his platform. Entering Wednesday, short sellers lost nearly $ 2 billion betting against the Hims & Hers stock.
“As more stocks, more sectors and more countries around the world begin to participate in this bull market, any of the short sellers who overcome their welcome are blown up,” wrote parets . “This is a classic feature of healthy bull market environments.”