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Trading of United States technology stocks has taken Sharesies by storm in a month where New Zealanders invested a record $488 million on the online platform in its six-year history - three quarters of which went to US markets.
Trading in much-hyped computer chip company Nvidia and SuperMicro Computer Inc, which recently joined the S&P 500 index, resulted in a record trading day on March 5 where $35.7m passed through the platform.
Investors would have benefited from both, with an 80 per cent increase in Nvidia’s share price year to date to US$871 and a 225 per cent increase in SMCI’s price to US$928.50 year to date.
Other chip companies linked to the artificial intelligence boom, Advanced Micro Devices and Taiwan Semiconductor Manufacturing Company, also had increases in ownership by local investors.
In total, 42,383 New Zealanders owned those four stocks on Sharesies at the end of March.
“The trend suggests that retail investors are increasingly aware of AI as a critical driver of future economic value,” a Sharesies spokesperson wrote in the fourth quarter Sharesies Index report.
“The popularity of tech stocks, in particular microcomputing companies, seems to have led investors to focus on the US markets, with investing volumes in US markets increasing 58 per cent in the last quarter.”
The amount of funds deposited by investors increased slightly to a 1.44 net deposit ratio, from 1.33 in the previous quarter, but remained below 2021 and 2022 levels.
The amount withdrawn by users also increased, hitting a record in March - Sharesies did not initially make this figure public.
“Perhaps due to the cost of living pressures, it appears that some investors are using wealth created on Sharesies.”
The Sharesies online trading platform has 620,000 investors across Australia and New Zealand, giving them access to 8000 stocks and funds across five exchanges.
Trading activity leaned more towards selling, with sales of stocks overtaking buying in the month.
“With soaring prices in a number of widely held investments, the selling was a rational approach by investors who had made gains.”
More New Zealanders were entering the active investing market at rates higher than Sharesies had seen over the past 18 months.
35,000 new investors signed up in the three months to March, taking its total user count to 620,000 across New Zealand and Australia.
Sharesies had more than $3 billion in funds under management, including in its saving and KiwiSaver schemes.
Nvidia CEO Jensen Huang co-founded the company that makes graphics processing units (GPUs) aka. advanced computer chips, in 1993. Its share price has risen 80 per cent this year to date.
Hottest stocks
BlackRock’s iShares S&P 500 exchange traded fund was one of the biggest movers up the popularity ranks in the March quarter, rising 20 places to rank 45.
AMD also jumped 20 places, while Nvidia lifted by 17.
Nvidia’s rise saw it land in the top five most-owned companies, knocking Mainfreight off the leaderboard.
The most popular companies remained Air New Zealand, followed by Tesla and Apple. Auckland International Airport was fifth.
While ownership of New Zealand stocks is dropping, airline Air New Zealand remains the most popular stock on the Sharesies platform.
The most popular exchange traded or managed funds did not change in the quarter, staying in the order of the NZX-owned Smartshares US 500 ETF, Pathfinder Global Responsibility Fund, Smartshares NZ Top 50 ETF, Vanguard 500 Index Fund ETF and Pathfinder Global Water Fund.
New Zealand equities were among the biggest losers with Ryman Healthcare, Cannasouth (in voluntary administration) and the Smartshares NZ Top 10 ETF all dropping in the ranks.
US-listed GameStop and Rocket Lab declined in popularity too.
Madison Reidy is the host of the NZ Herald’s investment show Markets with Madison. She joined the Herald in 2022 after working in investment, and has covered business and economics for television and radio broadcasters.
