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The major US exchanges released mid-month short interest figures for March yesterday, and below we list the S&P 1500 stocks that have the highest short interest as a percentage of float. For each company we also list whether the stock is a large, mid, or small cap company as well as how each one has performed year to date. Looking at the breakdown of companies by market cap, nearly half (16) of the 33 names on the list are small cap stocks. While this may sound disproportionate, it is not uncommon to see higher short interest levels among small caps.

Former market darling Diamond Foods (NASDAQ:DMND) currently has the highest short interest as a percentage of float, with more than half of its free floating shares sold short. DMND is followed by Barnes & Noble (NYSE:BKS) at 50.17% and KB Home (NYSE:KBH) at 46.66%. Other notable names on the list include First Solar (NASDAQ:FSLR), Sears Holding (NASDAQ:SHLD), and JC Penney (NYSE:JCP). JCP is an interesting name, as a lot of investors have turned bullish on the stock since former Apple executive Ron Johnson took over as CEO. With more than 25% of the company's free-floating shares sold short, however, a good deal of investors remain unconvinced. Only time will tell, but if Ron Johnson can work his magic on JCP like he did with AAPL and Target (NYSE:TGT), the shorts could be in for one heck of a squeeze.

Finally, with an average year to date return of 9.14%, traders who have been short the names below have had a painful year. If there's any consolation for them, however, the S&P 500 is up more than 12%, so at least these names have underperformed the market.

(Click to enlarge)