Hammerson is most shorted UK company, alongside Metro Bank and Sainsbury's

Hammerson is the most shorted UK listed company as investors bet against the beleaguered shopping centre operator, research shows.

With 14.04% of its shares held in short positions Hammerson is far ahead of the next most-shorted stocks, Metro Bank and Sainsbury's, GraniteShares said. Its research showed 8.68% of Metro's shares were shorted and 8.39% of Sainsbury's.

Hammerson's business was already under pressure before the Covid-19 crisis forced mass branch closures by retailers, causing commercial property values to drop and casting doubt over the viability of Hammerson's assets such as London's Brent Cross.

Hammerson's shareholders voted for an £825m rescue plan on 1 September that includes a 3552m rights issue. The company's shares hit an all-time low of about 217p in May and were down 0.9% to 281p at 14:32 BST.

Short sellers borrow shares which they then sell and hope to buy back later at a cheaper price. Shorting is a bet against a company's share price. With 4.33% of the company's shares, Caxton Europe is Hammerson's biggest short seller of 11 funds betting against the stock.

The rest of the top 10 most shorted shares are Premier Oil (8.13%), Cineworld (7.99%), Tullow Oil (7.53%), Royal Mail (7.51%), Petrofac (6.06%) and TUI (5.83%). Many of the companies such as Hammerson, Cineworld, TUI and oil companies have been hit by the Covid-19 crisis.

After plunging in March when the extent of the Covid-19 crisis became clear stock markets have rebounded, leaving some short sellers exposed. Short sellers los about £420m on FTSE 100 companies in August, GraniteShares said.

Will Rhind, chief executive of GraniteShares, said: “Markets around the world rose in August, which resulted in losses for many short sellers. However, markets are very volatile at the moment and we have recently seen executives of large listed companies selling off some of their stock, which has resulted in share prices falling."