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May ETF Short Report: GLD Shorts Spike 24%

Olly Ludwig

Short-sellers again ganged up on the SPDR Gold Shares (GLD) last month, marking the second-straight month the world’s biggest physical gold ETF has been under fire amid growing views that the 12-year rally in gold is in peril amid increasing signs the worst may be over in the global economy.

The number of GLD shares being sold short jumped almost 24 percent in May after shooting up by 83 percent in April, according to data compiled by IndexUniverse. Total short interest amounted to 8.41 percent at the end of last month, compared with 7.87 percent in the prior month.

The rising short interest in GLD was consistent with an ongoing exodus from GLD this year. In May, the ETF was saddled with about $3 billion in outflows, ending the month with $45.4 billion, or almost 11 percent less than at the end of April. That asset drop came on top of a 19 percent slide in assets under management in April. Assets in GLD have dropped this year by 38 percent from $72 billion at the end of 2012.

More broadly, investors are looking at what appears to be a slowly but steadily improving economy in the form of rising stocks, stabilizing housing prices and steady improvements in the job market. That has taken out much of the fear factor that has powered gold higher in the years since the market meltdown. Moreover, inflationary pressures have yet to seriously materialize, undercutting gold’s allure as a store of value.

Another noteworthy development in May was the 35 percent increase in shorts in the iShares MSCI EAFE Index Fund (EFA). That change was accompanied by a 15 percent rise in shorting on the CurrencyShares Euro ETF (FXE), according to data compiled by IndexUniverse.

Big Bets
Ticker Name % Float Short 1 Month % Change $Short ($, M)
SPY SPDR S'P 500 28.35 -0.51 39,265.53
IWM iShares Russell 2000 67.50 2.61 14,209.29
EEM iShares MSCI Emerging Markets 9.73 -3.99 3,999.67
XLE Energy Select SPDR 49.38 38.65 3,815.06
GLD SPDR Gold 8.41 23.96 3,795.48
QQQ PowerShares QQQ 10.13 -19.87 3,523.84
IYR iShares Dow Jones U.S. Real Estate 50.18 -13.15 2,640.38
XLF Financial Select SPDR 17.93 16.58 2,499.93
EFA iShares MSCI EAFE 5.64 35.14 2,345.95
XRT SPDR S'P Retail 239.81 14.71 2,298.20


Really Really Short
Ticker Name % Float Short 1 Month % Change $Short ($, M)
FXE CurrencyShares Euro 369.07 15.00 641.64
XRT SPDR S'P Retail 239.81 14.71 2,298.20
XOP SPDR S'P Oil ' Gas Exploration ' Production 217.26 8.44 1,745.03
FXY CurrencyShares Japanese Yen Trust 127.97 5.01 218.26
VXZ iPath S'P 500 VIX Mid-Term Futures ETN 102.76 -7.85 57.29
RTH Market Vectors Retail 95.29 -5.26 28.35
KBWR PowerShares KBW Regional Banking 94.64 12.32 20.86
CVOL C-Tracks Citi Volatility ETN 94.22 10.27 1.70
USO United States Oil 90.94 39.86 768.06
SMH Market Vectors Semiconductor 89.53 -12.20 326.40


Data is believed to be accurate; however, transient market data is often subject to subsequent revision and correction by the exchanges.

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