Indian investors are leaving no stone unturned when it comes to diversifying their portfolios. Besides dabbling in real estate, gold, debt, and domestic equities, investors have started buying US stocks to hedge their portolfio against economic risks.
Winvesta’s Quarterly Investor Pulse Report for the April-June quarter highlights investor preferences during the quarter in terms of US stocks and ETFs, growth in AUM despite the market correction and many other factors.
Despite the significant correction seen by US equities last quarter, Winvesta’s overall Assets Under Management (AUMs) increased 65% year-on-year, as of June 30, 2022. Transaction volumes during the same 12-month period have risen 2.5x.
A majority of Indians continue to choose single stocks over ETFs as their preferred mode of exposure to Wall Street, although the allocation to ETFs is increasing. The share of ETFs as a percentage of Winvesta’s AUM has risen to 24.75% in Q2 2022, from 17% in Q1 2022.
For many Indian investors, when they first hear US equities, ‘FAANG’ stocks are the first to come to mind. However, on Winvesta’s platform, there’s a broad gamut of over 4,500 stocks and ETFs to choose from.
FAANG stocks only constitute 14% of the total stock investment through the platform, which is lower than last year’s figure of 17%.
When it comes to the most traded stocks on Winvesta’s platforms, meme stocks have made an exit this year while they were among the most traded during Q2 2021.
Otherwise, investors continue to bet on the Apple’s and the Tesla’s. Twitter also makes an appearance in Q2 this year due to who else, but Elon Musk! Crypto as a theme remained prominent, with stocks like Coinbase making the cut in both 2021 and 2022.
As highlighted earlier, ETF allocation is increasing on Winvesta’s platform. People bet on Cathie Wood’s ARK ETFs for the better part of 2021. With massive value erosion, those ETFs have fallen out of favour among investors. Instead, they chose to park their money in other alternatives that played the market volatility like SQQQ.
Courtesy Winvesta’s platform, investors can also invest in fractions within US equities. For example, one can buy 1% of Alphabet’s (Google’s Parent) stock for around $22 and doesn’t require $2,200 to participate in the company’s growth story (GOOGL stock price is around $2,200).
Investors get capital gains, dividends, and voting rights proportional to their holding. Alphabet has also announced a 20-for-1 stock split recently. The average account size on Winvesta’s platform has seen a marginal jump from $5,000 to $5,300. The average transaction size has seen a substantial jump from the June quarter last year.
Due to a modest fixed fee involved in the remittance process, most investors prefer making lump-sum transfers and then invest it over time. However, many clients are remitting repeatedly as systematic or opportunistic investments.
Winvesta’s clients are spread across the country with majority of the client base skewed towards the younger population. The age group of 20-40 constitutes nearly 80% of the client base. Residents of tier-II and tier-III towns are also opening and funding their accounts on the platform along with the metros. With Winvesta’s digital onboarding and KYC, an Indian living anywhere in India can create an account and invest in US stocks.
Majority of the investors continue to be male. However, the number of women investors, which had doubled to 12% in Q1 this year, is back down to 6% in Q2.