- Buy now, pay later lenders Afterpay and Zip were amongst the most traded stocks of last year, according to broker Saxo Markets.
- The sector faced a tumultuous year with regulators, while stock prices rose rapidly. They were joined by mining titans Fortescue and BHP which were buffeted by a highly volatile iron ore price.
- Meanwhile, US tech darlings Facebook, Apple, Amazon and Microsoft all appear to be held by Australian accounts in anticipation of rising stock prices.
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It looks like buy now, pay later companies split the market last year.
Afterpay was the number one most bought and sold company amongst Australian stocks in 2019, while Zip came in at number four, according to online broker Saxo Markets.
"Both Afterpay and Zip are companies that have tapped into the growth of the buy now pay later phenomenon that has become very popular with consumers in recent years. This, in turn, has captured the imagination of investors and traders alike as the share price performances of both companies in 2019 was 136% and 225% respectively," Saxo Markets Australia CEO Adam Smith told Business Insider Australia. "Afterpay now has a market capitalisation of $8.55 billion, propelling it to number 60 in the ASX 200."
They were closely followed by miners Fortescue and BHP in places two and three, while Microsoft listed on the US Nasdaq came in at number five.
The stat lends itself to believe that people were buying the stocks as much as they were offloading them, with Afterpay alone having to fight Australia's counter-terrorism watchdog Austrac, an RBA review into its main revenue stream surcharging and the suggestion the service might hurt your chances of getting a home loan.
Certainly, speculation has been rife whether companies in the sector are overvalued flashes in the pan or serious disrupters. Zip co-founder Peter Gray has speculated that Afterpay's many copycats are headed for a day of reckoning as the sector consolidates. Last year though proved a good year for both financially, as both Afterpay and Zip's stock prices soared.
Equally, furious Fortescue and BHP trading could well be the result of wild fluctuations in the iron ore price, caused by Brazillian mining disasters and Fortescue's own operations being shut down by Cyclone Veronica.
Frequent trades, however, may have been a disadvantage last year though, Smith said, as broader stock markets had a better than expected year.
"Even though 2019 was characterised by high geopolitical uncertainty around the US-China trade war and Brexit, this did not drag on the long-term performance of global markets. Many who exercised patience between tweets and headlines throughout the year were very well rewarded."
Microsoft meanwhile became the biggest listed company by market cap exceeding $1 trillion last year and a stock price that gained more than 50%.
Meanwhile, Saxo also revealed the biggest stocks its Australian clients are holding, confident presumably their stock price is on the way. Perhaps unsurprisingly, its big US-listed tech stocks that have captured the attention of Australians with Apple, Facebook, Microsoft, Amazon and Alibaba taking out the top five spots.
"Interestingly our Australian clients no longer seem to have a local bias when it comes to long-term stock holdings as they can see the opportunities that abound in international equity markets, particularly the US," Smith said. "However, interest in local names does remain strong with ASX listed stocks becoming more actively traded."
A US-China trade deal being signed on Wednesday bodes well for all five, while what lies ahead for Afterpay and Zip is anyone's guess.