SOXX spent August in a tug-of-war between retreating bears and a stubbornly stressed lending market — and heading into September, the borrow side has won the latest round.
The clearest development this week is that availability has tightened sharply again after a brief recovery. After bouncing to 45.8% on August 27 — flagged in the previous note as relief that wasn't quite relief — availability has since dropped back to 23.1%, down 27% on the week. The lending pool is once again very tight: for every four shares already lent out, fewer than one remains available to borrow. The 52-week low hit on August 12 was 4.3%, so the market is not at maximum stress — but the direction of travel has reversed the progress made last week. Short interest, which fell sharply through the August 21-27 window, has ticked back up. Shares short climbed modestly on both Monday and Tuesday this week, recovering to 12.19 million after the prior week's 8.7% decline. At 21.7% of free float, the position remains large. Short sellers who covered are quietly rebuilding.
Options tell a different story from the borrow market — and it's the contrast that matters. After the extraordinary put/call spike to 4.28 on August 24 (the 52-week high, flagged prominently in the prior article), the PCR has normalised sharply. It closed Tuesday at 1.26, which is actually below its 20-day average of 1.42. The z-score of -0.24 places current positioning almost exactly in line with recent norms. Put buyers are not pressing the bearish case the way they were. Cost to borrow has also moderated from its August peak — it's running near 1.03%, well below the 1.55% reached on August 21, though still 26% above its level a month ago. The lending market is tight, but it is not in the acute stress that characterised mid-August.
The ORTEX short score has drifted lower this week, easing from 67.2 to 66.6 — a move that reflects the partial short covering seen last week rather than any fundamental shift in sentiment. The score remains elevated, consistent with a fund where positioning is still meaningfully bearish by historical standards. Institutional flows from the June quarter-end snapshot show a mixed picture: Goldman Sachs added 213,000 shares to hold 5.85% of the ETF, while Morgan Stanley trimmed by 356,000. Susquehanna, a major options market maker, added 877,000 shares — the largest single change in the top-holder list, though for a firm of that profile, the move likely reflects hedging activity rather than a directional view.
The ETF has lost 2.7% this week and is down around 1% over the past month, closing at $500.31. The broader semiconductor sector backdrop remains the dominant driver, with the ETF's price action closely tied to sentiment on AI capital expenditure and chip demand. No earnings event is scheduled for this fund, so the next catalyst is macro: any shift in the narrative around data centre spending, memory pricing, or trade restrictions on chip exports will register here faster than in individual names.
The setup heading into the back half of the first week of September is one of renewed pressure in the borrow market, short interest that has stopped falling, and options positioning that has normalised — three signals that, together, suggest the covering wave of late August has stalled rather than run its course.
See the live data behind this article on ORTEX.
Open SOXX on ORTEX →ORTEX Market Intelligence content is generated by AI from a snapshot of ORTEX's proprietary data. Content is informational only and does not constitute investment advice.
