It appears as if investors are nervous about the future of small-cap stocks and the exchange traded funds (ETFs) that carry them. Jesse Emspak for Investor’s Business Daily reports that investors shorted small-cap ETFs as high as 114% of assets, as of September 17. This is a 6.6% increase since August, according to data from State Street Global Advisors. ETFs can be sold short easily because they trade throughout the day like stocks. Because they are valued intraday, exchanges release short interest data mid-month. Short interest is a good indication of how much investors are betting an investment will drop in value. Short interest shriveled the most in the finance sector, as those ETFs showed a 55.9% decrease in the short assets held.
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