Retail investors are chasing the rally in the stock market. Here's exactly what they're buying.
- Retail investors are "aggressively" chasing the stock market rally, according to Vanda Research.
- The buying has included both individual stocks and ETFs, suggesting that they are bullish on the broad equity market.
- "The monthly net inflows into US equities are now averaging $1.4 billion per day, close to the all-time record," Vanda Research said.
Retail investors are finally starting to buy into the stock market rally that began nine months ago and helped power the S&P 500 higher by nearly 30%.
According to a Thursday note from Vanda Research, retail investors are piling into both individual stocks and equity ETFs, suggesting that they are not only bullish on specific themes but are also getting more bullish on the broader stock market.
"The monthly net inflows into US equities are now averaging $1.4 billion per day, close to the all-time record of last March ($1.5 billion per day)," Vanda Research said. "While it may be difficult to see a further increase in the pace of cash equity purchases from these levels, there is still room for more speculative buying in the options space."
Within the individual themes of the stock market, Vanda Research observed that a rotation appears to be picking up as retail investors shift their buying power away from artificial intelligence stocks and towards electric vehicle stocks, with the change likely being sparked by Tesla's recent second-quarter delivery numbers.
"Retail investors often rotate between themes as they get excited by short-term trends, and the recent beat in Tesla deliveries could be the catalyst to drive an increase in exposure to other EV names," Vanda Research said.
Retail demand for stocks like C3.ai is starting to wane, while a jump in buying pressure has recently been observed in EV names like Rivian, according to the note.
These are the top 10 stocks retail investors have been buying the most of over the past five days, according to Vanda Research.
10. Uber
Ticker: UBER
Net Retail Purchases: $52.0 million
9. Micron Technology
Ticker: MU
Net Retail Purchases: $56.3 million
8. Pfizer
Ticker: PFE
Net Retail Purchases: $62.1 million
7. Meta Platforms
Ticker: META
Net Retail Purchases: $62.9 million
6. Alphabet
Ticker: GOOGL
Net Retail Purchases: $66.4 million
5. Amazon
Ticker: AMZN
Net Retail Purchases: $135.7 million
4. Advanced Micro Devices
Ticker: AMD
Net Retail Purchases: $211.2 million
3. Nvidia
Ticker: NVDA
Net Retail Purchases: $233.9 million
2. Apple
Ticker: AAPL
Net Retail Purchases: $255.2 million
1. Tesla
Ticker: TSLA
Net Retail Purchases: $1.2 billion