Hedge funds are betting the most against these stocks as market breaks down

Published Thu, Oct 26 20232:10 PM EDT

Investors raised their short bets against various solar stocks and electric vehicle charging companies as the stock market breaks down. Rapidly rising rates are raising fears of a recession, sending the stock market lower. Hedge funds, in turn, are raising their bets against stocks they feel are particularly vulnerable in a downturn. The S & P 500 is teetering in correction territory, down more than 9% from its closing high earlier this year. The Nasdaq Composite entered correction territory on Wednesday. The following companies trade on the New York Stock Exchange and Nasdaq with short interest of more than 25% of their total float and at least $100 million in market cap, as reported by the exchanges. Float is the number of shares available for trading. Here are the names, using FactSet data: Short interest in solar companies SunPower and Sunnova Energy rose to 30% and 38% of float, respectively, during the period. The stocks have faced heavy losses so far this year, but were trading higher on Thursday. SunPower gained 4%, while Sunnova added 12.2% on better-than-expected earnings. Investors also increased their bets against several electric vehicle charging and alternative power names. Short interest in ChargePoint increased 23% to roughly 91 million shares, while short interest in Plug Power rose 9% to 139 million shares. Short interest reached about 32% and 26% of the float in both of those companies, respectively. A handful of aviation stocks also saw a jump in short interest bets, namely Frontier Group and Archer Aviation , which saw short interest rise to 8% and 7%, respectively. Frontier on Thursday missed earnings and revenue expectations for the third quarter, impacted by higher fuel prices and uneven demand recovery, according to the company's CEO. Frontier said its booking volume has stabilized looking to the fourth quarter, however, which fueled investors' optimism. The shares were up slightly. Dating service Grindr was a new addition to the list, as the company saw short interest increase by 11% to about 1.5 million shares, or around 25% of float. Other names that saw elevated levels of short interest included crypto-related companies Marathon Digital and Cipher Mining , home goods e-retailer Wayfair and Canada Goose Holdings .