‘Buy buy buy’: Market volatility sparks retail investor frenzy

While many investors may have panicked when $110 billion was wiped off the sharemarket in a matter of hours on Monday, setting the scene for a volatile week, Marina Hilellis was filled with excitement.

“When you’re looking at the market and you see the red line dropping, there’s a feeling of FOMO [fear of missing out],” the Sydneysider in her mid-20s says. “I thought: ‘I need to get money into the market right now’.”

Hilellis, who works as an associate financial planner, always has the sharemarket on her mind. “I see markets dropping less as a negative thing and more as an opportunity. The sentiment is ‘buy buy buy’,” she says.

She had freed up cash in the immediate aftermath of the first missile strikes a week earlier, and when she saw discounted prices on a range of ETFs linked to resources and shares in a few of her preferred technology companies going cheaply, Hilellis pounced. She acted so quickly that she didn’t have time to run the trades by her fiance, who she typically consults on such decisions.

“He did have a bit of anxiety when I told him,” she recalls, before adding that after explaining the opportunity that the crash presented, “he has relaxed more”.

AJ Clores, a Sydney-based influencer who posts financial insights, describes this week’s volatility as “the moments you kind of wish for”.

“When everyone’s panicking, it’s a good sign to get in,” he says. The 27-year-old restrained himself from racing in at the peak of the meltdown on Monday, but says that once he felt surer that the fluctuations had levelled out more, “that’s the time to attack”.

While he stands by his strategy of investing in ETFs for the long term, Clores has made a play for some specific technology-linked ETFs, as well as those linked to defence industry companies. “While everyone is looking the other way at oil, I’m mainly going for technology and defence.”

Dramatic falls in the price of crude oil, followed by surges as the flow of tankers through the vital shipping artery of the Strait of Hormuz ground to a halt, made for a wild week in the world of retail investing.

In the US on Tuesday, a social media post by US Energy Secretary Chris Wright claimed that the US Navy had escorted an oil tanker through the strait. Prices of crude oil quickly fell by 17 per cent, triggered by a fresh sense of confidence in supply.

However, the post on X was an error, the White House later clarified.

While questions about the length of the current war and severity of oil supply issues have made the market volatile and risky for investors, a chunk of Australian punters continue to see opportunity, with trading platforms reporting strong activity from retail investors.

Gemma Dale, director of investor behaviour at Nabtrade, says Monday was one of the busiest ever trading days on the financial platform.

“The volumes are through the roof,” she said, noting that the record high levels at the start of the week occurred on a public holiday in some states, which normally dampens retail investing activity. “It’s astonishing.”

Longer-term investors, as opposed to day traders, dominated the activity, according to Nabtrade.

Newer retail investors, aged largely under 40 who are mostly focused on long-term ETF strategies, were one key cohort that sprung into action this week, Dale said. Products from fund manager Vanguard were by far the most popular trades, with the leading product finding buyers who made up 91 per cent of all movement.

Betashares’ high-yield product, and ETFs tracking the Nasdaq100 US index, were also bought in large volumes.

“Seeing the market down, it’s a great time to buy … the ETF guys were out in force,” Dale said.

The other cohort of investors who sprang into gear this week were older and more experienced in the market and geared towards holdings in individual companies, Dale said.

Mining giant Woodside experienced the largest number of trades of this type, almost evenly split between buyers and sellers. BHP and Pilbara minerals were also among heavily traded stocks at the peak of the week’s volatility. And there was a notable sell-off of shares in banks, Dale said.

On trading app Stake, users rushed to trade on the platform as soon as Monday’s crash had become apparent. Its brokerage account openings were up 41 per cent on Monday compared with the previous trading day.

“Typically, in times of uncertainty and escalating conflict in the Middle East, we see people moving into safe haven assets such as gold [ETFs], which we haven’t seen this week,” said Samy Sriram, a market analyst at Stake.

Stake users rushed to invest in instruments that tracked the futures market for West Texas Intermediate crude oil, as well as other oil-linked ETFs. “We haven’t seen such a dramatic move to oil like this before,” she said.

“Investors are really looking at the news and they take that directly into what they do in the market,” Sriram said. “Particularly as they see prices at the petrol pump going up and higher prices in their daily life, they think: How can I hedge this in my portfolio?”

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