S&P 500: Robinhood Buyers Refuse To Give Up On 10 Dropping Shares

You have to hand it to Robinhood (HOOD) traders. They are not letting an unpleasant begin to the yr for the S&P 500 completely scare them away from all their favourite shares.

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Robinhood traders proceed to keep up excessive conviction in 10 shares, together with Tesla (TSLA), Apple (AAPL) and AMC (AMC), primarily based on the just-released Robinhood Investor Index. Excessive possession stays in these shares, whilst all 10 of them are down this yr and all however three are underperforming the S&P 500, says an Investor’s Enterprise Day by day evaluation of knowledge from S&P World Market Intelligence and MarketSmith.

“Over the past a number of years, we have seen our prospects turn out to be a strong power within the markets and usher in a brand new period for Wall Road,” Robinhood mentioned in its Investor Index. “With this has come lots of hypothesis about our prospects’ portfolios. At present, we’re unveiling the Robinhood Investor Index to point out how our prospects are investing.”

Tough 12 months For Robinhood Buyers

It has been a tricky 2022 for many traders, together with Robinhood traders.

The Robinhood Investor Index peaked in Could 2021, and has been sinking ever since. And the ache has gotten worse nonetheless this yr. The index is down greater than 20% simply this yr, largely consistent with the drop of the Nasdaq composite Index.

However Robinhood traders are staying the course, at the least with the ten shares they’ve probably the most conviction in.

Robinhood Buyers Load Up With Tesla

It is not all that shocking given its reputation with Gen Z traders, however Tesla is the highest holding with Robinhood traders, too.

But it surely’s not been a clean experience, this yr. Shares of Tesla are down 24.7% this yr to 265.25. Analysts, too, are at the least not bearish on the inventory. They will calling for the inventory to be price 308.32 a share in 12 months time. And if that is proper, it could be a roughly 16% achieve. A lot hinges on profitability this yr. Analysts suppose the corporate’s revenue ought to rise 85% this yr.

Believing In S&P 500 Huge Tech

Robinhood traders are well-known for proudly owning speculative shares. However that is not fully the case.

Greater than 75% of the Robinhood Investor Index is wrapped up with giant cap shares, together with many within the S&P 500. And the biggest sector within the index is data know-how.

So it is not shocking to see Apple and Microsoft as giant holdings. Apple is the No. 2 largest place within the Robinhood index. Apple is beginning to damage traders like Warren Buffett this yr, dipping 22%. However retaining conviction excessive is harder on homeowners of Microsoft inventory. Shares are down 31% this yr. And but, Microsoft can be a high purchase place for a lot of giant institutional traders.

Hanging In With Meme Shares

Robinhood traders’ nerves of metal are most clear with AMC and GameStop (GME). Shares of those unprofitable firms are down greater than 80% and 50% from their 52-week highs, respectively. Simply this yr, theater chain AMC is off 74% whereas video-game vendor GameStop is down 32%.

And nonetheless, each shares stay extremely weighted in Robinhood portfolios. How lengthy traders can take the ache, although, stays to be seen.

Most Common Shares With Robinhood Buyers

Exhibiting most conviction in Robinhood Investor Index, however all are down this yr

Sources: IBD, S&P World Market Intelligence, Robinhood

Comply with Matt Krantz on Twitter @mattkrantz

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