Top traded stocks in 2021 and the themes we may see in 2022

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Equity markets provided further gains last year with global stocks returning 22.9% as the economic recovery continued. In this article, we reveal the most popular stocks in 2021 and investor sentiment on sectors is changing due to the current environment of rising interest rates.

What were the most popular stocks in 2021?

Last year was an overwhelmingly positive period for equity markets with many developed market stock indices reaching all-time highs as investors displayed confidence in the global economic recovery. Negative news seemed to mostly be shrugged off, the most pertinent being: historically high levels of inflation, new Covid-19 variants, and supply chain bottlenecks.

Whereas the success of vaccination programmes, booming labour markets as well as monetary and fiscal stimulus to support the economy appeared to win investors over. Overall, U.S. equities rose by a remarkable +30% in 2021, while U.K. and European stocks returned +18.4% and +14.7% respectively.

So, given the strong returns in the stock markets last year, what were the most popular equities amongst IG clients in 2021? The figure below maps the stocks that have been dealt the most last year, presented as a percentage of overall trades on share dealing, individual savings account (ISA) and self-invested personal pension (SIPP) accounts.

Figure 1: Top twenty most popular equities in 2021 by number of trades

Popularity of Electric Vehicles went beyond just Tesla

Electric vehicle companies had a significant presence in the top twenty most traded equities last year due to their high growth potential and environmental, social and governance (ESG)-friendly characteristics, with sustainable investing reaching records highs according to Bloomberg*. Tesla (TSLA) was, of course, the most popular stock within the industry, accounting for 1.4% of total trades from IG investors in 2021, but NIO Inc (NIO) was not too far behind at 0.9% of trades.

Furthermore, we saw a number of new listings within the electric vehicle space last year with the two most notable being Rivian Automotive (RIVN) and Lucid Group (LCID). Rivian was listed through a traditional IPO back in November 2021, raising an estimated $11.9 billion making it the largest listing last year and also the biggest IPO from a US firm since Facebook. On the other hand, Lucid elected to go public via a special purpose acquisition vehicle (SPAC) deal, under Churchill Capital Corp IV Ord which made up 0.5% of trades in 2021. Although, Lucid announced in December that it received a subpoena from the US Securities and Exchange Commission (SEC) to investigate its SPAC deal, shares of Lucid dropped as much as 19.5% after the news broke. Click here to read the full article