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SOXX gained 2.5% on the week to $582.82, but short sellers are not backing down, and options traders are more defensive now than at any point in recent months.
The positioning story is one of stubborn conviction from the short side, even as the ETF rallies. Short interest remains high at 24.1% of float, roughly 13.55 million shares, barely changed from the 24.3% level flagged in last week's note. The month-on-month build of 11% confirms this is not a transient position. What has shifted is the cost and ease of maintaining that bet. Borrowing costs dropped sharply to 0.66%, the lowest in the 30-day window and well below the 1.0% to 1.9% range that dominated mid-September. Availability has loosened just as dramatically: after spending most of September squeezed below 50%, the lending pool expanded to 95% this week, roughly one share available for every one already borrowed. The previous note described bears rebuilding into a comfortable setup. That comfort has increased further: the short side now pays less and faces less squeeze risk than at any point in the past six weeks.
Options traders, meanwhile, have grown more defensive in a way that wasn't visible a week ago. The put/call ratio climbed to 1.71, above its 20-day average of 1.51 and near the top of its recent range. The step up is notable in context: the PCR had been drifting upward since mid-September, but the pace has accelerated over the past two weeks. The 52-week high is 4.28, so there is headroom, but the direction is clear. More money is flowing into downside protection on the semiconductor space even as the index itself rallies. Bears are hedging with options as well as holding short.
The ORTEX short score has been stable and elevated, hovering between 65 and 67 over the past two weeks. That consistency matters: a declining short score alongside a high short interest reading would signal bears losing conviction. Instead, the score has barely moved, suggesting the aggregate short-side posture on SOXX remains deliberate rather than under pressure. Goldman Sachs and Susquehanna remain the two largest disclosed holders, with Goldman holding 5.85% of shares and Susquehanna adding 877,000 shares in the quarter ending June 30. Holocene Advisors and Harel Insurance both built new positions of note in the same period, each reporting over 740,000 shares. Institutional flow into the ETF is real, but so is the short interest sitting on top of it.
The tension heading into next week is whether the ETF's 12% one-month gain begins to pressure short holders toward covering, or whether weakening borrow costs give bears reason to extend. The put/call ratio and the stability of the short score are the two metrics most worth watching.
See the live data behind this article on ORTEX.
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