This article was produced 6 September 2024. 

Key takeaways: 

• Selfwealth members showed the strongest levels of buying interest for sold-down commodity shares including BHP, Fortescue, Rio Tinto, Woodside, Yancoal, and Whitehaven Coal. 

• By trade volumes, ASX-oriented ETFs recorded a surge in buying conviction, yet it was two US-oriented ETFs that posted the highest conviction in terms of money flow. 

• WiseTech Global became one of just three tech stocks to ever feature among the top 20 most held ASX shares in the Selfwealth community, and the first tech constituent since January 2022 

• As always past trends and performance are not an indicator of future trends and performance.   

August started with a resurgence in market volatility, with global indices rocked by a sharp sell-off, which subsequently flowed through to the ASX.  

However, by month’s end, and with reporting season becoming a focal point for investors, the local market was back near its all-time high. That meant the S&P/ASX 200 benchmark index delivered a flat result over the course of the month. 

Tech, financials, and industrials shares were key to the turnaround, while energy and materials shares underperformed on account of weaker commodity prices.  In a month of volatility, the Selfwealth community remained active and undeterred, with the following ASX shares gaining the most attention. 

ASX share trading activity 

Iron ore duo BHP (ASX: BHP) and Fortescue (ASX: FMG) were the most traded ASX shares in the Selfwealth community last month, as measured by trade volumes. They also commanded the second and third highest buying conviction of any top 20 names. Elevated trading interest in the pair aligned with a period where iron ore prices touched a two-year low as concerns about China’s economy, notably the nation’s property sector, prompted worries about steel demand. 

Machine-learning AI data business Appen (ASX: APX) recorded its highest-ever level of monthly trades. With the exception of one trading session, Appen shares largely bucked the market volatility at the start of the month, thanks in no small part to a quarterly activity report that detailed strong revenue growth, especially out of China, and with the company reportedly on track to be cash EBITDA positive in “early H2 2024”.  

Appen received broker upgrades after said update, but with the share price at one stage having soared as much as 180% in the space of a month, it would appear many Selfwealth investors were also keen to buy into the story. 

After shares in Woodside Energy (ASX: WDS) touched a 31-month low, buying stepped up in the energy major. More than seven out of every ten trades in WDS last month were buys. Said buying conviction was recorded in the face of subdued oil prices, but the company’s earnings report late in the month helped arrest the share price slide. 

Coal shares encountered stiff selling pressure throughout August, but two of the segment’s most notable names also came to the fore among Selfwealth investors. Yancoal (ASX: YAL) and Whitehaven Coal (ASX: WHC) were the 11th and 16th most traded ASX-listed shares by trade volumes, despite monthly share price declines of 23.8% and 13.3% respectively.  

Last month, both companies unveiled a significant drop in revenue and earnings for their respective reporting periods, but Selfwealth investors treated the sell-off as an opportunity to ‘buy the dip’. Over the last three months, one of the most common reasons cited by Selfwealth investors for buying interest in YAL and WHC has been a view that said shares might be “undervalued”. 

For the second straight month, selling activity dominated the narrative as far as bank shares ANZ (ASX: ANZ) and Westpac (ASX: WBC). Despite the broader market lending its support to lift these shares to multi-year highs, over 50% of Selfwealth trades in ANZ, and nearly two-thirds of Selfwealth trades in WBC were ‘sells’. The most common explanation nominated by investors who sold shares in these names concerned “taking profits”, with the pair up 20.9% and 44.6% respectively over the last 12 months. 

In ETFs, there was a notable increase in buying sentiment for funds at least partially or wholly exposed to the ASX.  

For instance, the buy-to-sell ratio for the Vanguard Australian Shares Index ETF (ASX: VAS) rose 3.8 percentage points (ppts), while the likes of Vanguard Diversified High Growth Index ETF (ASX: VDHG), BetaShares Australia 200 ETF (ASX: A200), and BetaShares Diversified All Growth ETF (ASX: DHHF) recorded increases of 4.4ppts, 4.5ppts, and 5.2ppts respectively. 

Furthermore, overall trade volumes in VAS rose 18.9% month-over-month. 

Elsewhere, amid a backdrop where tech volatility defined the early stages of the month, Global X Fang+ ETF (ASX: FANG) fell out of the top 10, with the Australian Equities Strong Bear Hedge Fund (ASX: BBOZ) making the cut instead. 

On the other hand, while trade volumes favoured ETFs with ASX exposure, when it came to money flow, the greatest uplift was for US-oriented funds. This included Vanguard MSCI Index International Shares ETF (ASX: VGS) and iShares S&P 500 ETF (ASX: IVV), which featured the highest buy-to-sell ratios among all top 20 securities at 75.1% and 72.0% respectively. 

Meanwhile, Commonwealth Bank (ASX: CBA) achieved far greater buying conviction than its peers in ANZ and Westpac. The contrasting fortunes of these shares suggest that while Selfwealth investors may be looking to take profits on some bank shares, CBA remains the most favoured stock for exposure to the banking industry, also evidenced by its status as the most held share in the community. 

Some other shares where money flow was largely influenced by buying activity included Origin Energy (ASX: ORG) and Rio Tinto (ASX: RIO), which were at odds with names such as Qantas (ASX: QAN) and Telstra (ASX: TLS), where the majority of money flow was linked to investors selling. In keeping with a common theme from last month, buying interest in ORG and RIO corresponded with both shares recording sizeable selloffs.    

What are the most popular ASX shares and ETFs? 

For the first time since October 2023, Commonwealth Bank reclaimed the top spot among the most held ASX shares in the Selfwealth community. For the third time in as many months, the stock set a new all-time high. 

Earnings season showcased a modest increase in net interest margins for the bank, with home lending competition reportedly easing and the cost of wholesale funding reducing over the last year. The bank declared record dividends in FY24, and despite trading ex-dividend through the month, CBA shares still managed to outperform the ASX 200 in August. 

Westpac and CSL (ASX: CSL) swapped places in third and fourth respectively. Even though there was significant net selling in WBC through August, the bank’s underlying share price increase offset said outflows, such that community holdings in the stock grew circa 2% over the month. On the other hand, CSL shares went backwards after issuing its guidance for FY25, and neither Selfwealth buying or selling had a definitive impact to stop the underlying share price decline. 

As for Woodside Energy, the stock rose one place to ninth for overall popularity as measured by the value of holdings in the community. The growth of said holdings was among the highest of all top 20 names, despite the stock tumbling as much as 10% at one stage early in the month. The energy major’s subsequent rebound, and heavy buying support accounted for what was otherwise a 5.3% increase in the value of all WDS shares on the platform. 

Last month also saw WiseTech Global (ASX: WTC) join the list of the most popular shares on the Selfwealth platform for the first time. That makes the company one of just three names from the information technology sector to ever join the top 20, and the first since January 2022. The two former representatives include Afterpay, which is no longer listed, and Brainchip (ASX: BRN).  

WTC shares leapt nearly 30% last month after the company reported its annual results, including EBITDA guidance for FY25 that was circa 4% higher than consensus estimates. The company also advised the market that it expects strong revenue growth to continue into FY26. Nearly $3 million worth of WTC shares were bought by Selfwealth members in August. 

Across the most popular ETFs, community holdings grew by low-to-mid single-digit percentages. The highest growth rate was set by the Vanguard Australian Shares High Yield ETF (ASX: VHY), where the total value of units in the fund, across all Selfwealth members, grew 4.7%.  

The underlying share price for VHY was flat across the month, which means growth was driven by buying support. That may have had something to do with last month’s reporting season, a period where dividends were announced for many of the holdings in this yield-oriented fund. 

As always past trends and performance are not an indicator of future trends and performance.   

That’s all for this Trade Trends report, stay tuned for the next edition this time next month!