SelfWealth Monthly Trading Trends: December

SelfWealth Monthly Trading Trends: December

Although December has typically been associated with a stock market Christmas Rally, the seasonal trend failed to eventuate last month as the ASX 200 fell 2.4%.

The worst-performing segments were the consumer staples sector, down 8.1%, followed by the telecommunications and IT sectors, which dropped 5.8% and 4.6% respectively. Shares from the materials sector were one of the only bright spots across the ASX, trading 1.5% higher.

Here is what the SelfWealth community were buying and selling through their SelfWealth trading accounts during December.

 

Which shares and ETFs were the most held?

The top 20 shares held within the SelfWealth community throughout December remained the same as that of the month prior, however, there were some adjustments to the order in which they featured.

CSL Limited (ASX: CSL) once again topped the charts, followed by the Big Four banks. In light of the poor result from the market during December, it was no surprise that each of these stocks fell in proportion with the index. With three of the banks paying dividends mid-month, it appears some of these proceeds were reinvested back into shares as the total value held for each of the aforementioned stocks increased by a modest percentage.

Neuren Pharmaceuticals (ASX: NEU) continued its ascent, climbing up one spot to become the 7th most-held stock by SelfWealth members. During the month, the company issued an end-of-year update and outlook for the year ahead, confirming that it met two of its key drug development milestones.

Another key stock to make a charge up the list was Woodside Petroleum (ASX: WPL). Despite the company’s shares falling 0.4%, positive sentiment followed the stock on account of the sharp increase in the price of oil across the month. The commodity price surged by double-digit figures, reaching a three-month high.

Cochlear (ASX: COH), Woolworths (ASX: WOW) and Afterpay (ASX: APT) were among the stocks which saw their ownership, as measured by the total value of stock held, diminish within the SelfWealth community. This is explained by the sharp fall in the market cap of each of these companies, which were lower by 4%, 9.1% and 7.3% respectively. In the case of Woolworths, investors appeared skittish about the prospect of a class action against the company relating to payment shortfalls for staff.

 

Stock Company
1 CSL CSL Limited
2 CBA Commonwealth Bank
3 WBC Westpac
4 NAB National Australia Bank
5 ANZ Australia and New Zealand Banking Group
6 AFI Australian Foundation Inv
7 NEU Neuren Pharmaceuticals
8 MQG Macquarie Group
9 TLS Telstra
10 BHP BHP
11 ARG Argo Investments
12 MLT Milton Corp
13 WPL Woodside Petroleum
14 COH Cochlear
15 WOW Woolworths
16 WES Wesfarmers
17 RIO Rio Tinto
18 APT Afterpay
19 RHC Ramsay Health Care
20 A2M The a2 Milk Company

 

There was only one change among the top ten ETFs held by members of the SelfWealth community. The Vanguard Australian Property Securities Index ETF (ASX: VAP) slid into 10th position, edging out the Vanguard Australian Shares High Yield ETF (ASX: VHY). The new addition underperformed the market in terms of capital appreciation, falling 4.1%, however, many real estate shares traded ex-dividend during December and this seasonality may explain increased ownership of the VAP ETF.

 

ETF Company
1 VAS V300AEQ/ETF
2 VGS VINTL/ETF
3 VDHG VDHIGHGROW/ETF
4 VTS VUSTOTAL/ETF
5 IVV ISCS&P500/ETF
6 A200 BETAAUS200/ETF
7 VEU VWORLDXUS/ETF
8 STW SPDR S&P/ASX 200 Fund
9 NDQ BETANASDAQ/ETF
10 VAP V300APROP/ETF

 

Which shares and ETFs were the most traded?

While the market performed poorly in December, the weight of buying volume to selling volume increased from November’s result despite trending lower the month prior. A bias towards buying activity aligns with one of the key reasons that seek to explain the ‘Santa Rally’, even if it ultimately didn’t transpire in this instance. Buying volume across all stocks was 1.5x that of selling volume.

 

Purchases
Code Security
1 VAS V300AEQ/ETF
2 BBOZ BETA SBEAR/FD
3 FMG Fortescue Minerals Group
4 CSL CSL
5 VDHG VDHIGHGROW/ETF
6 IVV ISCS&P500/ETF
7 VGS VINTL/ETF
8 WBC Westpac
9 APT Afterpay
10 STW SPDR S&P/ASX 200 Fund

 

Sales
Code Security
1 BBOZ BETA SBEAR/FD
2 FMG Fortescue Minerals Group
3 WBC Westpac
4 APT Afterpay
5 CSL CSL
6 BHP BHP
7 A2M A2 Milk
8 ANZ Australia and New Zealand Banking Group
9 STW SPDR S&P/ASX 200 Fund
10 APX Appen

 

For the second month in a row, there was a marked increase in the value of ‘bearish’ bets placed against the Australian stock market, however, this appears to be driven by a small number of investors. Buying volume in the Australian Equities Strong Bear Fund (ASX: BBOZ) almost doubled, just as it did during November, making it the second-most bought stock by value last month. Although the same stock remains the most-sold instrument within the community as well, the ledger has narrowed substantially to less than 10% differential between buy and sell volume.

One observation among the most-bought stocks points towards a clear trend, with ETFs gaining in popularity across the month. Investors took the opportunity to stock up on the likes of the Vanguard Diversified High Growth Index ETF (ASX: VDHG), iShares S&P 500 ETF (ASX: IVV), Vanguard MSCI Index International Shares ETF (ASX: VGS) and the SPDR S&P/ASX 200 Fund (ASX: STW).

The above funds, none of which featured in the leading stocks bought during November, gained traction over blue-chip favourites such as Commonwealth Bank (ASX: CBA), ANZ (ASX: ANZ), Telstra (ASX: TLS) and BHP (ASX: BHP). Each of these blue-chip names fell out of the top 10 stocks bought by SelfWealth members, suggesting investors were favouring a more balanced and diversified portfolio as the index lost momentum.

All but two of the stocks that were under selling pressure in November featured again in the top 10 list for December. CSL (ASX: CSL), however, joined the list in place of Telstra (ASX: TLS), which might be attributed to profit taking.

 

That’s all for this Trade Trends report, stay tuned for the next edition this time next month!

 

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SelfWealth Ltd ACN 52 154 324 428 (“SelfWealth”) (Australian Financial Services Licence Number 421789). The information contained on this web site is general in nature and does not take into account your personal situation. You should consider whether the information is appropriate to your needs, and where appropriate, seek professional advice from a financial adviser. Taxation, legal and other matters referred to on this website are of a general nature only and should not be relied upon in place of appropriate professional advice.

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