eToro Survey: Retail Investors Shift 2024

In eToro survey, retail investors plan to decrease big tech investments in 2024 due to expected market changes.

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In eToro Retail Investor Beat survey, retail investors worldwide reveal plans to shift away from big tech investments in 2024. According to the findings, over a quarter of retail investors (27%) intend to reduce their investments in the ‘Magnificent 7’ big tech stocks in 2024. The survey, which polled 10,000 retail investors across 13 countries, indicates that 11% plan to sell some of their holdings in these tech giants, while an additional 16% aim to decrease their capital allocation to these companies.

The ‘Magnificent 7’, comprising Amazon, Apple, Microsoft, Meta, Tesla, Nvidia, and Alphabet, have experienced a remarkable 90% collective share price surge since January 2023. However, the survey suggests a shift in investor sentiment amidst expectations of forthcoming rate cuts in 2024, anticipated to bolster other sectors in the equity market.

eToro’s Global Markets Strategist, Ben Laidler, commented on the findings, noting the anticipated rate cuts by global central banks and the resulting potential rotation away from big tech towards more economically sensitive areas like real estate, small caps, Europe, and emerging markets.

eToro Survey: Retail Investors Shift 2024

The survey also reveals that most global retail investors (53%) plan to rebalance their portfolios in anticipation of market shifts. Interestingly, younger investors aged 18-34 are leading this trend, with 71% already having or planning to rebalance their portfolios, compared to 37% of those over 55.

Regarding changes in asset allocation, the survey indicates that 48% of those planning to rebalance intend to increase equity investments, while 36% aim to reduce cash holdings.

Laidler highlighted the flexibility of younger investors in adapting to economic shifts, potentially influenced by their experiences navigating events like the global financial crisis and the COVID-19 pandemic.

Despite the trend of scaling back on big tech investments, the survey suggests that many investors remain committed to the sector. Approximately 23% plan to increase their investments in the ‘Magnificent 7’, while 34% intend to maintain their current allocation.

Furthermore, the survey indicates a continued interest in the tech sector, with 18% of global retail investors prioritizing tech investments in 2024, followed by financial services at 12%. Additionally, the proportion of investors holding AI-related stocks has increased from 27% to 31% in the first quarter of 2024.

The survey underscores the dynamic nature of retail investor sentiment and their proactive response to evolving market conditions, particularly in anticipation of significant economic shifts.

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