Investors bet on EV despite Omicron concerns, Freetrade reveals
Despite Omicron concerns startling the markets, investors are increasingly betting on electric vehicles (EVs), as according to online stockbroker Freetrade, four out of the 10 most popular stocks in November were from EV companies.
Newly listed Rivian and EV charging point Pod Point as well as consolidated firms such as Tesla feature among those most sought after.
Freetrade’s senior analyst Dan Lane told the Telegraph that investors have developed a thick skin towards market fluctuations caused by Covid-19, rejecting shares in the banking, oil and mining sectors.
“This could be because they have become thick-skinned and therefore worry less about virus news, or because American technology share prices had previously dipped so they are less worried about how expensive shares are,” he said.
People who trade on free apps such as Freetrade are more likely to be swayed by social media compared to investors who pay to trade, Rockwealth’s head of client education Robin Powell told the outlet.
“If people are talking about a certain stock, the temptation is to follow the herd. We saw the same with GameStop, and it’s happening now with Rivian.
“Technology seems to be hot at the moment, and electric vehicles in particular. But throughout stock market history investors have had their fingers burnt by investing in emerging technologies.”
After a tremendous $100bn IPO that brought markets to a frenzy, Rivian’s shares have finally settled down, varying between $110 and $120, while shares of EV charging company Pod Point fluctuate between 234p and 268p.
Powell’s words echoed those of GlobalData analyst Daniel Clarke, who recently told City PM that “it is important to note that the concept of value in the stock market has shifted significantly in recent years and is increasingly contested.”
“More traditional investors scorn Tesla and Rivian’s jaw-dropping market caps because of the huge gaps between their current revenue and their valuations.”