Short sellers in EIS have been quietly backing away — even as the iShares MSCI Israel ETF's month-long rally draws fresh attention to the Middle East's shifting risk landscape.
The most striking dynamic in the positioning data is the pace of the recent short-interest unwind. After nearly doubling between early April and late April, estimated short interest has fallen 12% over the past week to around 5.2% of free float. The build itself was dramatic: SI more than doubled between April 9 and April 23, as geopolitical tension spiked. That positioning has now partially reversed, consistent with the ETF's 7.4% gain over the past month to $134.82. The short score has tracked the retreat — easing from 46.1 to 42.3 over the past ten days, suggesting the overall pressure profile is cooling.
The borrow market tells the same story. Borrowing costs have fallen sharply from their early-April peak, when the rate touched roughly 2% annualised. Cost to borrow is now running near 1.37% — down around a third from those levels — and availability is generous at 436% of short interest. At that level, there is more than four times as much stock available to lend as there is currently lent out. That is a deeply liquid borrow pool: there is no mechanical squeeze risk on the horizon, and any trader wanting to establish a new short position faces no meaningful friction.
The macro backdrop is doing the heavy lifting here. EIS tracks large and mid-cap Israeli equities, and the fund's performance is closely tied to regional security conditions. Recent news around US-Iran diplomatic progress — and comments from Vice President Vance on negotiations — has contributed to risk-appetite improving toward Israeli assets. Notably, Israeli semiconductor names like and , which feature in the index, have both attracted positive analyst attention this week, with Jefferies raising its target on Camtek to $200 and Tower Semiconductor rising more than 7% on a technical breakout. Sector tailwinds in Israeli tech are amplifying the ETF's recovery.
The ownership picture is dominated by a single large holder. Korea Investment Corporation held 17.5% of EIS shares as of December 2025, with no reported change — a concentrated anchor position. More recently, Nilsine Partners added 50,234 shares in the first quarter of 2026, making it the third-largest disclosed holder at 3.3%. That fresh buying contrasts with several smaller advisory platforms — CoreCap, HighTower, and MML Investors Services — which trimmed modestly in Q1. The net institutional picture is cautiously constructive: more buyers than sellers, but no large-scale conviction pile-in.
What to watch next is whether the residual short position — still elevated relative to where it stood in early April — continues to compress as ceasefire and diplomatic news flow develops, or whether any deterioration in the regional security environment prompts the build to resume.
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