Key takeaways:

• There were nearly three times as many trades in ‘materials’ stocks than financials throughout October

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The ASX dipped to its lowest level in a year during October, with investors concerned about rising bond yields and the prospect that central banks may still have further work ahead to quash inflation.

Across the course of the month, the ASX 200 declined by 3.8%, its worst monthly result this year. 

Losses were greatest for rate-sensitive stocks, which meant another round of red ink for names within the tech and real estate sectors. 

What were Selfwealth members buying and selling? Here’s our monthly recap.

What are the most popular ASX shares and ETFs?

There were no changes at the top, where Commonwealth Bank (ASX: CBA), despite slumping 3.4% last month, remains the most popular stock within the Selfwealth community when measured by the value of collective holdings on the platform. 

Bank stocks still occupy five of the top eight spots across the community, and recent weakness from this cohort did little to diminish sentiment ahead of various earnings from the group, and expectations of high dividend yields to follow.

Resources stocks remain a core component of many portfolios as well, with BHP (ASX: BHP) the frontrunner in this respect, but ably supported by names such as Woodside Energy (ASX: WDS) and Rio Tinto (ASX: RIO).

BHP features in around 7,000 individual Selfwealth members’ portfolios, while Woodside is held across a little over 6,000 different portfolios. With the exception of Zip (ASX: ZIP), these two figures are more than any other non-ETF security traded on the ASX.

One interesting name that may surprise some readers is Australian Foundation Investment (ASX: AFI). A listed investment company (LIC) that specialises in managing a portfolio of Australian equities, the stock ranks ninth among all non-ETF ASX-listed holdings by value. When looking at how many distinct portfolios hold this security, AFI ranks sixth, with about 5,000 unique portfolios holding the stock.

Top 20 ASX Stocks

1. CBA - Commonwealth Bank

2. BHP - BHP

3. WBC - Westpac

4. NEU - Neuren Pharmaceuticals

5. CSL - CSL

6. ANZ - Australia and New Zealand Banking Group

7. NAB - National Australia Bank

8. MQG - Macquarie Group

9. AFI - Australian Foundation Investment

10. FMG - Fortescue Metals Group

11. WDS - Woodside Energy

12. PLS - Pilbara Minerals

13. WES - Wesfarmers

14. LTR - Liontown Resources

15. TLS - Telstra

16. RIO - Rio Tinto

17. SOL - Washington H. Soul Pattinson and Co

18. WOW - Woolworths

19. FLT - Flight Centre

20. WHC - Whitehaven Coal

Despite a tough time for the US tech sector last month, the Betashares Nasdaq 100 ETF (ASX: NDQ) swapped places with the Vanguard U.S. Total Market Shares Index ETF (ASX: VTS) in sixth and seventh positions respectively. The Selfwealth community has long supported tech stocks, particularly during downturns where, historically, buying activity has increased relative to selling activity. 

Top 10 Most Traded ETFs

1. VAS - Vanguard Australian Shares Index ETF

2. VGS - Vanguard MSCI Index International Shares ETF

3. VDHG - Vanguard Diversified High Growth Index ETF

4. IVV - Ishares S&P 500 ETF

5. A200 - BetaShares Australia 200 ETF

6. NDQ - Betashares Nasdaq 100 ETF

7. VTS - Vanguard U.S. Total Market Shares Index ETF

8. VHY - Vanguard Australian Shares High Yield ETF

9. VEU - Vanguard All-World ex-U.S. Shares Index ETF

10. AAA - Betashares Australian High Interest Cash ETF

ASX share trading activity

While the broader market may have lost some patience with the lithium segment last month, the Selfwealth community clearly didn’t get the memo. In fact, six stocks within the top 20 most traded names for the month represented this segment, including Pilbara Minerals (ASX: PLS), Core Lithium (ASX: CXO), Liontown Resources (ASX: LTR), Allkem (ASX: AKE), Mineral Resources (ASX: MIN), and Sayona Mining (ASX: SYA).

Lithium stocks have largely come under pressure on two fronts. First, general risk-off sentiment has worked against the cohort, part of a category of shares known as growth stocks, which tend to fall out of favour when bond yields rise. Secondly, the outlook for lithium prices has recently grown more uncertain, prompting some concerns. Nonetheless, this cohort was overwhelmingly supported by the Selfwealth community, with trades in each stock tracking around two-thirds buying support.

Meanwhile, as bank stocks dipped towards fresh lows, Selfwealth members took an opportunity to top up their holdings in two under-fire names, Westpac (ASX: WBC) and Bank of Queensland (ASX: BOQ). 

While the latter delivered an earnings report that fell short of market forecasts, and the former lost more ground compared with its immediate ‘Big Four’ rivals, the pair were among the most actively traded names in October, also garnering significant buying. They were joined by ANZ (ASX: ANZ) and Macquarie Group (ASX: MQG), where buying was the predominant force, albeit at a slightly muted rate.

Over recent months we’ve seen some strong buying interest in iron ore major Fortescue Metals Group (ASX: FMG), however, that shifted markedly last month. Nearly two-thirds of all trades in FMG were sell orders, which may have had something to do with the company’s slow start to FY24. The miner’s first-quarter trading update pointed to a 3% decline in ore shipments, as well as higher costs.

On a broader level, and excluding ETFs, the most popular sector for trades last month was the materials sector, accounting for 26.5% of all trades made. That was nearly three times as much as the financial sector.

Top 20 stocks by trades, with buy-to-sell ratio

Pilbara Minerals (PLS) - 66.9%

1. CSL (CSL) - 78.8%

2. BHP (BHP) - 51.0%

3. Fortescue Metals Group (FMG) - 38.9%

4. Macquarie Group (MQG) - 58.9%

5. ANZ (ANZ) - 57.4%

6. Qantas (QAN) - 73.9%

7. Westpac (WBC) - 65.7%

8. Woodside Energy (WDS) - 61.6%

9. Commonwealth Bank (CBA) - 55.0%

10. ResMed (RMD) - 84.0%

11. Core Lithium (CXO) - 61.9%

12. Whitehaven Coal (WHC) - 53.3%

13. Syrah Resources (SYR) - 56.3%

14. Liontown Resources (LTR) - 65.5%

15. Allkem (AKE) - 66.3%

16. Mineral Resources (MIN) - 68.7%

17. Australian Foundation Investment (AFI) - 78.2%

18. Bank of Queensland (BOQ) - 70.0%

19. Sayona Mining (SYA) - 66.9%

Exchange-traded funds were as popular as ever last month, representing almost one-third of all trades in ASX-listed securities. Of that total, 75% of trades were buy orders, supporting the buy-and-hold and dollar-cost averaging strategies that we have long seen across the Selfwealth community.

In a number of cases, the most traded ETFs drew even more buying activity than the segment-wide average. Nowhere was this more evident than the most popular ASX-oriented funds, the Vanguard Australian Shares Index ETF (ASX: VAS) and BetaShares Australia 200 ETF (ASX: A200), where nine out of every ten trades were buy orders.

Top 10 ETFs by trades, with buy-to-sell ratio

Vanguard Australian Shares Index ETF (VAS) - 90.5%

1. Vanguard Diversified High Growth Index ETF (VDHG) - 82.3%

2. Vanguard MSCI Index International Shares ETF (VGS) - 82.2%

3. BetaShares Australia 200 ETF (A200) - 90.4%

4. Ishares S&P 500 ETF (IVV) - 85.1%

5. BetaShares Nasdaq 100 ETF (NDQ) - 70.8%

6. BetaShares Geared Australian Equity (Hedge Fund) (GEAR) - 63.8%

7. BetaShares Diversified All Growth ETF (DHHF) - 85.2%

8. Australian Equities Strong Bear Hedge Fund (BBOZ) - 53.6%

9. Vanguard Australian Shares High Yield ETF (VHY) - 82.2%

There were a number of surprising movements when it came to money flow throughout the community in October, even among ETFs.

For starters, Vanguard’s Diversified High Growth Index ETF (ASX: VDHG) was the second most traded ASX-listed ETF last month, and over 80% of all trades were buy orders. However, those buy orders accounted for just 46.1% of money flow, indicating that it was smaller buyers doing the buying, and larger holders taking their proceeds off the table. 

Despite a swathe of bad publicity for Qantas (ASX: QAN) of late, the stock attracted notable money flow throughout the course of October. Even more surprisingly, a majority of that was fresh money into the stock. It appears that some long-term investors may be banking on the airline weathering the storm and coming through the other side with monster earnings, as was the case recently.

Coal duo Whitehaven Coal (ASX: WHC) and New Hope Corporation (ASX: NHC) both made the cut as well, however, support wasn’t uniform for the duo. Money flow in the former was trending at a buy-to-sell ratio slightly over 40%, while the latter was circling almost 70%. 

Coal prices tumbled last month, but the bigger reason behind the discrepancy was that NHC shares traded ex-dividend in October, and were largely supported in the lead-up to that event. On the other hand, some investors thumbed their nose and took profits after WHC announced a $5 billion acquisition for BHP’s metallurgical coal mines.

Top 20 securities traded by value, with buy-to-sell ratios

• Betashares Geared Australian Equity Fund (GEAR) - 52.7%

• Pilbara Minerals (PLS) - 50.5%

• BHP (BHP) - 46.4%

• Australian Equities Strong Bear Hedge Fund (BBOZ) - 50.2%

• Betashares Australian High Interest Cash ETF (AAA) - 51.8%

• Fortescue Metals Group (FMG) - 43.3%

• Vanguard Australian Shares Index ETF (VAS) - 76.0%

• Westpac (WBC) - 57.6%

• Commonwealth Bank (CBA) - 52.0%

• Global X Ultra Long Nasdaq 100 Hedge Fund (LNAS) - 50.6%

• CSL (CSL) - 60.5%

• Macquarie Group (MQG) - 46.3%

• ANZ (ANZ) - 49.1%

• Whitehaven Coal (WHC) - 40.8%

• Bank of Queensland (BOQ) - 60.4%

• Woodside Energy (WDS) - 54.9%

• Vanguard Diversified High Growth Index ETF (VDHG) - 46.1%

• Qantas (QAN) - 56.6%

• New Hope Corporation (NHC) - 69.5%

• Vanguard MSCI Index International Shares ETF (VGS) - 69.3%