JETS has spent the past month becoming one of the most-shorted ETFs in the market, and that pressure intensified again this week even as the fund fell sharply.
Short interest has nearly doubled since late July. It climbed from roughly 8 million shares around August 10 to above 11.3 million by September 1 — a 30% jump in a single week and a 42% rise over the month. That puts short interest at 41.4% of free float, a level that signals deep, organised bearish conviction rather than opportunistic hedging. Days-to-cover runs at five days, meaning any reversal in sentiment would take time to unwind. The ORTEX short score confirms the pressure: it has held above 71 for two consecutive weeks and reached 73.8 on August 31, placing JETS in the top tier of the universe for short-side stress.
The borrow picture adds texture. Availability has been volatile but is now notably looser than it was in late July and early August. Back then, availability dropped to near zero — almost every lendable share was out on loan — squeezing the pool for new entrants. Now, with availability at roughly 71%, there is meaningfully more room in the lending pool than there was a month ago. That loosening matters: it allowed the fresh wave of short-building this week without triggering a borrow squeeze. Cost to borrow ticked up 8% on the week to 3.7%, well below the 8.7% peak seen at end of July, so the carry cost of holding a short position remains manageable.
Options positioning tells a contrasting story. The put/call ratio has dropped sharply — from above 3.7 in late July and early August to just 1.35 now, more than one standard deviation below its 20-day average of 2.58. That is close to the 52-week low of 0.91 and the sharpest rotation toward calls seen all year. The divergence is striking: short sellers are adding positions at the highest rate in months, while options traders have stepped back from the heavy put-buying that characterised late summer. One reading is that the options market is reflecting short-term relief — perhaps a view that the worst of the airline sector's near-term pain is priced — while short sellers see a longer structural story. Name the contrast directly: the two positioning signals are pulling in opposite directions right now.
The fund itself is down 10.8% over the past month, closing Tuesday at $27.89 after a 7.3% fall on the week and a further 2.1% drop in the last session alone. That price action tracks neatly with the short-building: sellers have been right in the near term, and continued momentum lower has kept the trade well in the money. No earnings event is scheduled for JETS itself given its ETF structure, so the next price-mover will come from constituent airline results and any macro developments on fuel costs, travel demand, or capacity guidance.
What to watch: whether availability continues to ease or tightens again toward the near-zero levels seen in late July — that borrow dynamic, more than the short count itself, will determine how quickly a positioning reversal could play out if airline sector news turns.
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