Australian traders have embraced the power of the meme, with Tesla, GameStop, and AMC among eToro’s top 10 most-held stocks

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  • Tesla, GameStop, and AMC ranked in the 10 most-held shares among Australian eToro investors in the second quarter of 2021.
  • The trading platform has revealed Elon Musk’s electric vehicle venture was the most-held by domestic traders, many of whom believe in the sector’s long-term prospects.
  • But Reddit-backed stocks like GameStop, AMC, and BioNano Inc. suggest many traders don’t want to experience internet-fuelled FOMO.
  • Visit Business Insider Australia’s homepage for more stories.

Tesla and other meme stocks like GameStop and AMC were some of Australia’s most-held securities on eToro for the second quarter of 2021, suggesting some domestic retail traders were all too keen to cash in on the hype borne overseas.

New data from the online trading platform shows electric car manufacturer Tesla was the preferred stock of Australian eToro traders over the first month of the year, climbing one place from the same period in 2020.

Elon Musk’s venture was joined by Shanghai-based competitor Nio in the #2 spot, with domestic investors sensing a global pivot away from internal combustion vehicles will power both firms to higher valuations in the years to come.

“We can see that Australian investors are adapting to a long-term buy-and-hold strategy with both these assets, anticipating that the EV space will dominate the automotive industry for many years to come,” local market analyst Josh Gilbert said in a statement.

“Tesla has slightly more skin in the game than Nio, and that’s why Australian investors are opting for Tesla shares right now.”

But it appears not every trader was purely focused on the fundamentals, with shares in American video game retailer GameStop marked as the third most-held stock over the last three months.

The data suggests many Australian traders, emboldened by the Reddit-led run on the stock at the start of the year, are ‘diamond hand’-ing their way through the stock’s recent fluctuations.

Remarkably, the stock has climbed 256 places since the second quarter of 2020 — and the traders who already had a stake in the company in June 2020 may have watched the value of their holdings increase 50 times over since then.

The meme-stock success story did not end with GME, though, as shares in American cinema chain AMC were the ninth-most held asset on the list.

Spurred by online claims of undervaluation, optimism in America’s response to the coronavirus pandemic, and a little hope in another GameStop-style short squeeze attempt, it appears Australian traders lined up to buy shares which have increased roughly 1,000% in value in the past twelve months.

BioNano Inc., a company focused on the emerging field of cytogenenomics and another target of Reddit-led bullishness, appears on the list at #7.

More traditional tech companies fill out the remainder of the top ten. Stalwart stock Apple was ranked #4, rising data analytics giant Palantir was #5, Amazon #6, Microsoft #8, and online marketplace Alibaba #10.

Domestic holdings largely matched the most-held stocks worldwide, although publicly-listed cryptocurrency exchange CoinBase appears on that list as the #8 most-held stock.

While eToro asserts the bulk of its traders are delving into stocks based on their fundamentals, the list also suggests an appetite among online daytraders, many of them first-timers, to experiment with hyped stocks and hyped currencies.

The list comes just a day after US-based competitor Robinhood released the paperwork for its own IPO on the Nasdaq, revealing that its own stock price could be rocked by fluctuations or regulations impacting Dogecoin — the meme cryptocurrency which accounts for a stunning 34% of the platform’s trading revenue.

eToro did not divulge similar data about its own userbase’s appetite for Dogecoin, which was listed on eToro back in May.

However, the latest data suggests many Australians have turned their focus from rock-bottom bank interest rates and bluechip shares, and are experimenting with memey investments instead.