SGOL heads into the week of May 18 with a notable divergence: short positions are building rapidly even as the gold price and the ETF's shares have retreated sharply over the past month.
The most striking move is in the borrow market. Short interest jumped roughly 48% over the past week to around 987,000 shares, equal to about 0.56% of the float. That level remains low in absolute terms — this is not a crowded short. But the pace of the build is unusual. The one-week gain alone is close to 45%, and availability has tightened meaningfully in response, dropping from over 860% last Monday to around 410% by Tuesday — still comfortably above the halfway point, but a significant shift from the near-unlimited pool that existed just a week earlier. Borrowing costs remain cheap at 0.32% annualised, down nearly half over the past month, so the tightening in availability has not yet pushed costs higher. The direction of travel in the lending market is worth watching.
Options positioning offers a contrasting read. The put/call ratio has been almost perfectly flat at 0.37 — barely a fraction above its 20-day mean of 0.374, with a z-score effectively at zero. That marks one of the most neutral options setups in the past year, with the 52-week range running from 0.03 to 0.84. Traders are neither rushing for protection nor making aggressive bullish bets via options. The short-side activity is not showing up in derivatives at all.
The price context explains why some traders are pressing the short side. SGOL has fallen roughly 8% over the past month to $42.69, with the week alone contributing almost a 5% decline. Gold's retreat from its highs — driven by easing macro fear and some dollar stabilisation — is the logical backdrop. The ORTEX short score has climbed to 39.98 from a low of 27.7 on May 14, a week-long drift that confirms short-side pressure is building incrementally rather than arriving in one aggressive burst.
Overall, positioning is cautious but not extreme. Short interest is rising from a very low base, availability has tightened without becoming restrictive, and options are unmoved. The key variable to watch is whether borrowing costs follow the availability trend higher — if they do, it would confirm that conviction behind this short build is genuine rather than mechanical.
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