Twitter Inc and GoPro Inc witnessed net retail buying in September, according to data from T.D. Ameritrade. The online broker’s monthly survey of over 6M clients and their trading activity showed that investors continued to remain active in the market despite the ongoing bearish tone.
“Investors are continuing to participate in a rocky market, and they’re doing it in a pretty smart way by rotating into stocks that are less volatile than the market as a whole,” Nicole Sherrod, managing director of trading at T.D. Ameritrade said.
Investors took the opportunity to accumulate some popular stocks that were on sale. “All ships sink in a sinking tide and investors tend to buy on a dip some of their favorite retail stocks,” Sherrod added.
Twitter Acquisition Rumors Spurred Investor Interest
Among the stocks that saw healthy retail interest include new-age stocks like Twitter and GoPro.
Traders and investors were net buyers of Twitter Inc , a popular momentum name, which got engulfed in uncertainty as to who it would choose as a permanent CEO, and when the announcement would be made (Thank God it finally happened).
“Twitter is a name that has fallen under a lot of scrutiny and pressure to the downside,” Sherrod said. She also noted that besides the CEO chatter, investors were drawn to the stock amid a lot speculation surrounding whether Twitter is an acquisition target.
Investors also acquired shares of GoPro Inc , the maker of wearable cameras. Its stock is down close to 50% in the past three months. The sell-off was largely due to lower-than-expected guidance from chip maker Ambarella, a key component supplier to GoPro.
Investor sensed opportunity in the stock rout. GoPro has strong recent growth and an decent profitability. And the drop in price only made the stock available at a much cheaper multiple.
Besides Twitter and GoPro, investors also scooped up high dividend yield names like Chevron (5.2%), Verizon (5.1%) and Exxon-Mobil (3.7%).
Volatility Fell in September
On the volatility front, the Ameritrade survey showed it continued to remain high in September. But on a month-on-month basis, it declined. The firm’s Investor Movement Index computes volatility relative to the overall market. It dropped to 4.76 in September from 5.24 in August.
The survey also released net selling data. Investors cashed in on a host of stocks that hit 52-week highs, like Motorola and JC Penney. “There’s a lot of profit-taking in down markets as well,” says Sherrod.
Yahoo was another big name stock that saw net selling. Its shares dropped lower post the expiration of Alibaba’s lock-up period.
Shares of Twitter Inc ended Tuesday at $27.62. GoPro Inc closed at $30.65.