For bears the selloff has been profitable. Energy companies in the Russell 2000 were the most heavily shorted in the index at the end of June, according to data compiled by Bloomberg.

Short Interest

Short interest, the amount of uncovered short positions held by investors, represented 10 percent of the average energy company’s outstanding shares, data provided by Markit show. That compares with an average 4.5 percent in the overall index.

The PowerShares S&P SmallCap Energy Portfolio saw its market capitalization shrink 38 percent since the most recent selloff starting April 15. The fund now has a market value of $34 million.

“When big entities are in small stocks, they have to react quickly,” John Manley, who helps oversee about $233 billion as chief equity strategist for Wells Fargo Funds Management in New York, said by phone. “That’s exacerbating the selling situation. It would’ve happened at some point, but the hedge funds make it happen faster and make it seem more painful.”

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