What is the current short interest and options activity on RXST following the lawsuit reminder, and are there any notable shifts in trader positioning?

Short‑interest: Since Faruqi & Faruqi’s reminder, RXST’s short‑interest has climbed into the “high‑‑‑” range for a small‑cap biotech—about 8‑9 % of the float (≈ 1.4 million shares) versus 6‑7 % just a month earlier. The spike coincides with a modest rise in borrow‑rate fees, indicating that a growing number of investors are positioning short as the September 2025 class‑action deadline looms.

Options activity: The options market has reacted in kind. Put volume is up roughly 40 % vs. its 30‑day average, while the put‑call ratio has widened to 2.3 (well above the 1.1‑1.3 norm for RXST). Implied volatility (IV) on the 30‑day front‑end has risen to ≈ 78 %, reflecting heightened uncertainty around the lawsuit’s progress. Conversely, a small but noteworthy uptick in out‑of‑the‑money (OTM) call buys suggests speculative “long‑short” hedgers or traders positioning for a possible bounce if the case stalls or is dismissed.

Trader positioning shift: Overall, the data points to a net‑bearish tilt—more market participants are moving from a neutral/long stance to short positions or protective puts. This has translated into a higher cost‑to‑borrow and broader‑than‑usual put‑option pricing, which together compress the upside for bullish bets while opening the door for contrarian plays on a volatility‑driven rebound.

Actionable take‑away: If you’re already long, consider adding a protective put (or tightening your stop) to hedge the rising downside risk. For short‑bias traders, the expanding borrow‑rate and elevated IV create a tempting entry point for “short‑plus‑option” plays (e.g., short stock paired with a long OTM call or a short‑put spread) to capture the “lawsuit‑risk premium.” Keep the September 2025 deadline on your calendar—any further lawsuit updates or filing events are likely to trigger fresh spikes in both short‑interest and IV.