High-net-worth investors, defined as those with $5 million or more invested in the sharemarket, seized the opportunity presented by Monday’s market downturn to acquire stocks in select companies and exchange-traded funds. Data from Bell Direct Advantage, a trading platform catering to high-value portfolios, revealed that Credit Corp, DroneShield, and a Vanguard broadly diversified ETF were among the popular buys.
According to Bell Potter investment strategist Rob Crookston, this behaviour reflects a common “buy-the-dip” strategy employed by wealthy investors. They often capitalise on market volatility to acquire assets at lower prices. However, these investors also offloaded shares in companies such as Zip, Woolworths, Coronado Resources and 4D Medical during the same period, some of which had experienced gains prior to the market dip.
Magellan Global Fund, an actively managed ETF, also saw significant trading activity, with large sell orders matched by substantial buy orders. Other companies experiencing similar trading patterns included ProMedicus, CSL, and WiseTech Global. Crookston noted that high-net-worth and retail investors are increasingly leveraging market mispricing during volatile periods.
Crookston highlighted that ETFs are now more prominent in the trading activity of wealthier investors compared to the previous year. High-net-worth investors are taking profits from assets that have performed well and that the increase of fast money in the market is leading to high volatility and bigger moves.
