Source: Wind
Hong Kong's Wande News Agency reported that there is no doubt that after a period of "rest and recuperation", individual US investors have once again entered the capital market. Only this time, instead of speculating in meme stocks and virtual currencies, they fixed their sights.$Tesla (TSLA.US)$Companies related to AI.
According to similar data from Vanda Research, the inflow of individual investors in the US stock market reached the level of 2020-2021. Tesla, Inc. is the main target of individual investors.
"Tesla, Inc. shares are experiencing an unprecedented surge in demand, and artificial intelligence-related stocks such as NVIDIA Corp and AI, as well as other stocks such as FAANG, have also seen a surge in demand to a lesser extent," Giacomo Pierantoni, senior vice president of Vanda Research, Lucas Mantle, head of data, and Marco Iachini, a data science analyst, said in a report on Thursday.
"if over-the-counter retail funds continue to flow into the market at the current rate, we think more speculative retail traders will also have an opportunity to make up for the weakness of the options market," the team said in a report to clients. "activity in the options market has been very low last year."
According to the current data, individual investors have not been influenced by the Fed, which is different from the phenomenon in early 2021. "that is, speculation in AI-related stocks or other niche markets does not rule out continued speculation if macro conditions remain favourable in the short term," the Vanda research team said.
Major u.s. stock indexes rebounded strongly in early 2023, with the technology-heavy NASDAQ up nearly 15%, the s & p 500 up 8% and the Dow Jones industrial average up 3.2%.
JPMorgan Chase & Co reported last month that retail orders as a percentage of market capitalization reached 23 per cent on January 23, compared with GameStop's surge when retail orders reached 22 per cent on several occasions. The US stock market has also seen a rebound in total trading volume, which fell in the second half of last year as investors focused on disciplined long-term buying.
The Vanda team said the rebound in trading volumes indicated an improvement in risk appetite and that "options may then pick up, albeit to a different extent, given that a large portion of the WSB population may still be licking their wounds in 2022". They say the market needs to see the continued resilience of the US economy, the participation of "fast fund plenipotentiaries" and more purchases of mutual funds and pensions for the stock market to spread beyond Tesla, Inc. and AI.
At the same time, it is hoped that a soft landing may keep the money flowing. JPMorgan Chase & Co pointed out that elderly investors have been involved in a lot of investment recently and are likely to continue to buy stocks and bonds unless optimism about inflation subsides.
According to JPMorgan Chase & Co, older investors who prefer to invest through ETF have injected $81 billion into bond funds and $44 billion into equity funds so far in 2023, while last year they sold an "unprecedented $340 million bond fund without buying equity funds".
As for Tesla, Inc. 's cash flow, Vanda Research points out that in the most recent week, the electric carmaker received 24 per cent and 33 per cent of individual shares and overall net purchases of all US listings, respectively. Although they believe that investors "chase the momentum of stocks to make up for the losses in 2022", with the arrival of Tesla, Inc. 's investors' Day on March 1, investors also give more expectations, and share prices are also rising.
The Vanda team notes that large net inflows of retail money have continued to flow into C3.ai over the past few days, although this has begun to slow down. Individual investors are also investing in related small-cap stocks, such as BigBear.ai,SoundHoundAI.
NVIDIA Corp and Microsoft Corp may be the next companies to attract the interest of big investors. "if Tesla, Inc. 's share price continues to rise rapidly, causing retail investors to lock in profits or avoid increasing further exposure, we expect stock demand to turn to NVIDIA Corp and Microsoft Corp as alternative investment options," the Vanda team said.
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