For five years it’s been the fate of American short sellers to be wrong, as the biggest rally since the Internet bubble steamrolled defensive trades.

They’re loading up again, sending bearish wagers in the SPDR exchange-traded fund tracking the Standard & Poor’s 500 Index to almost 11 percent of its shares, the highest proportion since 2012, according to data compiled by Bloomberg and Markit Securities Ltd. Bets against a technology ETF are 67 percent above the 12-month average.

One of the best things you could do in the stock market over the last three years has been to buy shares from short sellers, who borrow stock with the aim of replacing it once the price falls. After bearishness peaked in 2011 and 2012, the S& P 500 rallied more than 14 percent within six months. With U.S. valuations approaching levels not seen since 2007 and the Federal Reserve scaling back stimulus, the bears are back again.

“That, from a trader’s standpoint, is a bullish sign, because you don’t have too much optimism in the market,” Walter “Bucky” Hellwig, who helps manage $17 billion at BB&T Wealth Management in Birmingham, Alabama, said by phone. “That there isn’t unbridled optimism shows that there could be more upside.”

Frontier Communications Corp. a voice and data services company in Stamford, Connecticut, and Boise, Idaho-based chipmaker Micron Technology Inc. are among companies with the highest bearish bets. Their shares have soared more than 22 percent this year. A Goldman Sachs Group Inc. measure of the hedge fund’s biggest short holdings has risen 7.8 percent this year, compared with a 5.5 percent gain for the S& P 500 .

More than $1.6 trillion has been added to American share values since the end of January amid accelerating economic growth and actions by central banks to stimulate the expansion. The S& P 500 advanced 1.3 percent to a record 1,949.44 last week as the European Central Bank cut interest rates and U.S. unemployment stayed near a six-year low.

While the S& P 500 has rallied for 10 of the last 12 days and advanced each of the last four months, investors have been withdrawing money from the market. About $4 billion was pulled last month from the S& P 500 ETF, the world’s biggest with $164 billion in assets, data compiled by Bloomberg show. Funds that buy domestic shares have received $4.8 billion this year, compared with deposits of $25 billion in bonds.

Frank Maeba, managing partner at Breton Hill Capital Ltd. in Toronto, said he’s shorting the S& P 500 ETF and has bought options to hedge his stock holdings. The Chicago Board Options Exchange Volatility Index slid 5.9 percent last week to 10.73, a seven-year low.

“Eventually there will be a hiccup, but the market isn’t very worried about immediate tail risks,” Maeba said in a June 6 interview. His firm manages about $550 million. “We’ll buy some protection maybe at these levels, just in case something happens.”

The S& P 500 trades at 16.5 times estimated profit, about the same as the end of the last bull market in late 2007, data compiled by Bloomberg show. Technology companies make up some of the most expensive stocks in the market. Salesforce.com Inc. Amazon.com Inc. Facebook Inc. and Autodesk Inc. all trade above 39 times forecast earnings.

Ed Hyland, an Atlanta-based global investment specialist at JPMorgan Chase Private Bank, said as long as the economy is growing and earnings are rising, U.S. equities will move higher. Data last week showed that employers added 217,000 jobs in May to push U.S. payrolls past their pre-recession peak and the jobless rate held at an almost six-year low as the economy gained traction.

“Just because the market is at a record high doesn’t mean it has to revert back to the mean,” Hyland, whose firm manages about $1 trillion, said by phone. “We’re feeling very good about where markets are and where the economy is.”

In the past two years, peaks in short selling have foreshadowed bigger stock-market gains as concerns about the economy or political conflicts proved unfounded and bearish investors turned bullish.

The number of shares borrowed and sold in hopes of declines jumped in the middle of 2011 as S& P stripped the U.S. of its AAA credit rating and the S& P 500 sank 19 percent. Confidence was restored as the ECB pledged to support the euro and American companies generated record profits. The S& P 500 recovered the losses within six months and finished 2012 with a 13 percent gain.

In late 2012, investors piled into bearish bets and stocks slumped after President Barack Obama’s re-election set up a budget showdown with the Republican-controlled House of Representatives. Lawmakers reached an agreement by the end of the year, triggering a 5 percent rally in the S& P 500 for January 2013.

When short selling rose to 10 percent of the S& P 500 ETF in September, about the same level as now, the U.S. equity benchmark climbed 11 percent through the end of the year, according to data compiled by Bloomberg.

This time it’s the end of the Fed’s asset-buying program and high valuations for Internet stocks that’s fueling concern. Borrowed shares of the Powershares QQQ Trust ETF reached a two- year high of 5.9 percent last month and are at 4.1 percent now. For the S& P 500 ETF, the level of bearish bets has risen threefold since the beginning of the year.

“This is one of the most-hated bull markets,” Stephen Solaka, who helps oversee about $150 million as managing partner of Belmont Capital Group in Los Angeles, said by phone. “A lot of people are praying for the market to fall. There are a lot of professional shorts. It’s been a painful trade.”

Hedge funds that specialize in short selling have been punished by the strongest bull market since the technology bubble in 2000. They’ve endured losses in four of the past five years and returned minus-1.8 percent this year through May 31, according to Hedge Fund Research Inc.

The difficulty of shorting in 2013, which saw the broadest bull market since at least 1990, has driven investors out of the strategy. The average company in the S& P 500 has about 2.3 percent of its shares borrowed to speculate on declines, near an all-time low, Markit data show.

Not every short has lost money. Staples Inc. is the 10th most-shorted stock in the S& P 500 with borrowed shares making up 13 percent of those outstanding. The Framingham, Massachusetts- based company is down 29 percent this year amid rising competition from Amazon.com and sluggish demand for office supplies.

At the same time, Joy Global Inc. the Milwaukee-based maker of mining equipment, has seen short interest climb to 18 percent from 2 percent last year. The stock surged 12 percent last week, the biggest gain in almost two years, after reporting higher-than-estimated profit. It’s up 9.6 percent for 2014.

“Those short-sellers will have to cover and that actually can help push markets higher,” Kate Warne, a St. Louis-based investment strategist at Edward Jones, which oversees $787 billion, said in a June 4 interview at Bloomberg’s headquarters in New York.