John McCrank

NEW YORK (Reuters) – U.S. retail investors bought stocks during Thursday’s selloff, even as many of their favorite names have been battered by worries over geopolitical strife and a hawkish Federal Reserve that looks set to keep volatility elevated.

According to Vanda Research data, individual traders purchased a net $1.5billion on Thursday. This was in addition to the intraday loss of almost 14% due to concerns over Russia’s invasion Ukraine. The market then surged higher late in the day.

“We believe that retail investors played a key role in driving the sharp rebound in equities yesterday,” Giacomo Pierantoni, head of data at Vanda Research, said in a note. The benchmark index went up 2.24% Friday to cut its loss year-to-date by 8%.

JPMorgan (NYSE) data shows that retail investor buying declined in the last week. Flows fell by half to $1.8 million in the week up to Wednesday according to earlier data.

The year-to-date decline in the S&P 500 and the 12.5% drop in the Nasdaq have masked far larger declines in many of the stocks and ETFs that retail traders have favored in recent months.

Analysts believe that volatility in Ukraine will continue to rise as investors consider the implications of Europe’s most serious attack on an EU state since World War Two.

Steve Sosnick, chief strategist of Interactive Brokers (NASDAQ): “It is one more volatility-inducing incident on top of an already offer plenty of volatility opportunities.”

Interactive Brokers’ clients were able to identify the top-performing stocks on Thursday, using a five day moving average. This includes many names that took a beating this year.

The active stocks with net buys were Tesla (NASDAQ) Inc down 23.4%; Advanced Micro Devices(NASDAQ:) Inc down 15.9%; Meta Platforms Inc down 37.4%; and Roku (NASDAQ:) Inc., Down 38.8% Year-to-date.

Analysts at Vanda stated in separate notes that many of the favorites among retail investors are in the red by 2022. This means the average punter’s portfolio could also dip into the negative.

Russia’s growing aggression towards Ukraine has led to retail investors focusing their attention on possible winners and losers.

Retail traders are interested in the United States Oil Fund (NYSE 🙂 LP ETF. This ETF had last week the second highest weekly net purchasing flow from retail investors since April-May 2020, according to them.

According to JPMorgan’s tracking, ProShares UltraPro QQQ ETF was the top-rated pick for retail investors over the week. It bets on the and has increased 38.6% annually.