10 most traded US stocks by Australians in 2020

Posted: 1 September 2020 11:30 am

Tesla and rival Nio top the list as the two favourite US stocks by Australian traders this year.

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In case you missed it, US stocks are going bananas this year. Since the market crashed in March, the S&P 500 has gained 55%, hitting five consecutive record highs last week and wiping all losses resulting from the pandemic.

Australian portfolios absent of US stocks may have just missed out on one of the best growth opportunities in decades.

Spearheaded by the arrival of new low-fee US trading apps in recent years, Wall Street stocks have become increasingly popular in Australia, especially among "next-gen" traders.

Global online broker eToro has seen its Australian customer base grow by more than 510% since the start of the year after launching commission-free US stock trading, as traders look to take advantage of the market volatility during COVID-19.

This new style of online broker is decidedly "millennial" focused rather than "boomer", with a customer base that's more aligned with Reddit's r/wallstreetbets than the Financial Review.

Scroll the discussion threads there and one stock quickly stands out. Depending on who you listen to, it's either about to land on the moon or is the single biggest bubble in history.

And according the latest data from eToro, the automaker is also the most traded US stock by Australian users, followed by its rival.

Tesla the stock of 2020?

Tesla (TSLA) not only keeps its hoard of fans happy with frequent showy company updates, Elon Musk makes a point of keeping in touch with traders, more often than not stirring the pot and driving share price volatility.

Back in May, Elon Musk sent company stocks falling 6% after suggesting its price was overvalued over Twitter. Meanwhile a crude three-letter message to the SEC in July wasn't enough to discourage a 10% rally in the four days following.

Tesla's stock has been rallying again in August, jumping an incredible 50% in the last month after it announced a 5-for-1 stock split at the end of August. While it doesn't increase the value of your shares, the price reduction makes the stock more affordable for the masses.

So it's little surprise that Tesla (TSLA), followed by up and comer Chinese rival Nio (NIO), are also the two most traded stocks this year by Australian users. In the last year alone, Tesla's share price has jumped 420% while electric vehicle startup NIO has seen similar gains of 434%.

Other household names, including Apple, Amazon, Microsoft and Facebook, also appear on the most traded list of both Australian and US users amid newfound enthusiasm for technology companies.

Below are a list of the 10 most traded stocks on eToro by Australian users in 2020 (as of 25 August), along with their recent stock price performance.

Disclaimer: This information should not be interpreted as an endorsement of futures, stocks, ETFs, CFDs, options or any specific provider, service or offering. It should not be relied upon as investment advice or construed as providing recommendations of any kind. Futures, stocks, ETFs and options trading involves substantial risk of loss and therefore are not appropriate for all investors. Trading CFDs and forex on leverage comes with a higher risk of losing money rapidly. Past performance is not an indication of future results. Consider your own circumstances, and obtain your own advice, before making any trades.

Top traded US stocks of 2020

1. Tesla (NASDAQ: TSLA)

  • YTD performance (to 27 August): 420%
  • Announced 5-for-1 stock split in August
  • Reported profit for fourth straight quarter in July
  • Electric battery news earmarked for "Battery Day" in September

2. Nio (NYSE: NIO)

  • YTD performance (to 27 August): 434%
  • Chinese electric vehicle manufacturer
  • Pegged as major competitor to Tesla
  • Latest quarterly revenue more than doubled

3. Apple (NASDAQ: APPL)

  • YTD performance (to 27 August): 66.49%
  • Announced 4-for-1 stock split in August
  • Topped $2 trillion market cap
  • Surpassed Saudi Aramco to be world's most valuable company

4. Amazon (NASDAQ: AMZN)

  • YTD performance (to 27 August): 79.13%
  • Posted highest ever full-year profit of US$5.2 billion
  • Online sales jumped 48% in the quarter
  • Online shopping surged during pandemic

5. Microsoft (NASDAQ: MSFT)

  • YTD performance (to 10 June): 41.07%
  • Potential TikTok acquisition pegged for September
  • Team software competes with Slack and Zoom
  • Cloud technology companies have benefited from WFH model

6. Facebook (NASDAQ: FB)

  • YTD performance (to 27 August): 39.78%
  • Ad sales rose 10% to $18.3 billion in Q2
  • Active monthly users rose to 2.7 billion
  • #StopHateForProfit boycott saw 1,000 major companies stop paying for ads from July

7. Advanced Micro Devices (NASDAQ: AMD)

  • YTD performance (to 27 August): 70.67%
  • US semi-conductor company
  • Manufactures GPU chipsets used in gaming processors
  • Major rival to Intel and Nvidia

8. Alphabet (NASDAQ: GOOGL)

  • YTD performance (to 27 August): 18.98%
  • First quarter revenue was $41.2 billion, up 13%
  • Faces potential antitrust lawsuits
  • YouTube ad sales grew just 6% this quarter, compared to 33% in Q1

9. Boeing (NASDAQ: BA)

  • YTD performance (to 27 August): -47.74%
  • Boeing shares plunged from March on pandemic
  • Commercial aircraft sales fell 65% to $1.63 billion
  • Production expected to continue slowing

10. Nvidia (NASDAQ: NVDA)

  • YTD performance (to 27 August): 110.55%
  • Designs video game graphics-processing units
  • Video game graphics cards sales jumped during COVID-19
  • Revenue up 25% over the previous quarter to $3.87 billion

What has become more apparent this last year is the US has enormous stock growth opportunities. Wall Street doesn't just house some of the biggest and most well-known companies in the world, it has also outperformed our market by a significant margin in the last decade.

With many of us forced to work and socialise from home, technology stocks have dominated gains in 2020. The combined values of Apple, Amazon, Microsoft, Facebook and Google, now account for almost 25% of the biggest 500 US companies, compared to less than 20% pre-COVID-19.

If you’d invested $500 in the benchmark ASX 200 index just after the 2008 market crash, you’d have seen it grow to $860 as of May this year. On the other hand, if you’d invested in Wall Street’s NASDAQ index during the same time, it would have grown to over $1,500.

For more information on investing in Wall Street from Australia, check out our guide to buying US stocks.

Image: Getty

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