- US shares popular among customers in a month where the S&P 500 and Nasdaq hit a new record high
- Investors return to a popular way of playing the bitcoin price
- Gilts remain in demand as investors look for short-term capital gains
Dan Coatsworth, investment analyst at AJ Bell, comments:
“With US markets having hit new record highs during February, it’s not surprising to see five US-listed names appear in the top 10 most popular stocks with AJ Bell customers over the past month.
“The S&P 500 and Nasdaq have been on the move since October 2023 when markets started to price in a succession of interest rate cuts from the Federal Reserve during 2024. Having taken advantage of higher cash rates over the past few years, investors are now moving out of savings accounts and back into equities as rates trend lower.
“The artificial intelligence boom is still in full swing and positive messages on the opportunities to grow earnings from the likes of chip giants Nvidia and Arm Holdings has made them popular stocks to hold in portfolios. This hot investment theme, along with a more positive outlook for the semiconductor space, has also driven investors to tech-themed collectives.
“Polar Capital Technology and L&G Global Technology Index Trust feature among the investment trusts and passive funds with the biggest net inflows of money on the AJ Bell platform during February.
“The rally in US equities reflects increased investor risk appetite and this trend has extended to other asset classes including cryptocurrencies. Bitcoin rallied last month and such an event has historically driven trading in MicroStrategy shares, something that happened again in February among AJ Bell customers.
“MicroStrategy describes itself as a business intelligence company yet most investors see it as one way of playing the bitcoin price as it holds 193,000 bitcoins. The value of its bitcoin holdings hit $12.2 billion in late February.
“UK government bonds – better known as gilts – remain popular with investors. One strategy has been to buy them for potential capital gains rather than income. In theory, gilt yields should fall as the market prices in greater confidence that the Bank of England will cut rates. The key risk to this approach is that it can only take one economic data point such as sticky inflation figures to push back expectations for when rate cuts could happen. That could push up gilt yields and pull down their price.”
Most popular investments with AJ Bell’s DIY investors in February
Below are the most popular shares, investment trusts, funds (active and passive) and bonds with DIY investors on the AJ Bell platform in February.
