Market Overview

5 Most Expensive Stocks To Borrow Right Now

5 Most Expensive Stocks To Borrow Right Now

There are several key differences between shorting a stock and going long a stock. One of the major differences is that buying and holding a stock is free outside of the commission paid on the trades. Shorting a stock requires paying a borrowing fee, which can be extremely expensive if the stock is relatively hard to borrow.

Borrowing And Lending Shares

At the same time, shareholders that own a hard-to-borrow stock can earn income by lending out their shares to short sellers. Brokers like E-Trade, Interactive Brokers, Fidelity and Charles Schwab offer securities lending programs in which clients can simply opt into a program to passively lend out the shares they own in their portfolio. Brokers often split the borrowing fees with the lenders. For example, Interactive Brokers splits the fees 50/50 with its customers.

Most stocks with a large supply of available shares are not very expensive to borrow and not very lucrative to lend. However, short sellers are paying astronomically high fees to bet against a handful of popular stocks to short.

“Long shareholders can take advantage of heavy short selling in their securities by lending out their ‘in demand’ shares and earning stock loan fees by lending out their ‘fully paid for’ shares,” Ihor Dusaniwsky, analyst at financial analytics form S3 Partners, said this week.

Expensive Stocks To Borrow

Here are the five most expensive stocks to short and the five most profitable stocks to lend, according to S3:

1. Beyond Meat Inc (NASDAQ: BYND)

  • Short Interest: $871.8 million
  • Short % Of Float: 46.3%
  • Borrow Fee: 152.1%

2. Turtle Beach Corp (NASDAQ: HEAR)

  • Short Interest: $70.8 million
  • Short % Of Float: 49.8%
  • Borrow Fee: 45.1%

3. Health Insurance Innovations Inc (NASDAQ: HIIQ)

  • Short Interest: $194.4 million
  • Short % Of Float: 75.8%
  • Borrow Fee: 44.8%

4. Plug Power Inc (NASDAQ: PLUG)

  • Short Interest: $110.2 million
  • Short % Of Float: 21.2%
  • Borrow Fee: 34.3%

5. Frontier Communications Corp (NASDAQ: FTR)

  • Short Interest: $99.8 million
  • Short % Of Float: 59.1%
  • Borrow Fee: 34.3%

Related Links:

Short Sellers Double Down On Twilio Following Rally

Why A Beyond Meat Short Squeeze May Be 'Just Around The Corner'

Photo courtesy of Beyond Meat.

Latest Ratings for BYND

May 2020BTIGInitiates Coverage OnBuy
May 2020JP MorganMaintainsNeutral
May 2020DA DavidsonMaintainsNeutral

View More Analyst Ratings for BYND
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