Tesla became the most popular investment among Malaysian investors in April 2020.
New data from the eToro investment platform in early May showed that nine out of the Top 10 shares invested by Malaysians in April 2020 are technology companies. Compared with March, the volume of purchases in Malaysia increased by 19%.
Tesla, which is not only a car manufacturer, but also a technology company, has become a favorite of choice on eToro, rising from 4th to 1st place last month.
The investors see the potential of the company, which despite the COVID-19 continues its successful development and reported on the third consecutive profitable quarter. Moreover, this situation further emphasized Tesla's advantages over its competitors from various fields.
Commenting on the trade situation, eToro said that while not a single company is safe from the economic downturn, technology companies seem less vulnerable to a pandemic and economic situation.
An eToro senior market analyst, Nemo Qin, said:
"During the economic downturn, investors prefer to invest in consumer staples or dividend aristocrats than other sectors. However, it seems that the interest in the technology sector has not only remained; but technology stocks have increased in popularity among investors during the pandemic.”
Analysts believe that the current popularity and high demand for technological investments will continue until the end of 2020.
He also said, that there are several reasons why technology stocks have become popular with investors. In most cases, investors prefer these stocks, as the companies behind them have tested and proven successful business models. Moreover, they have good financial statuses. These factors support the development of companies and business operations.
In addition, people spend more time and resources on technology products. Whether it's e-commerce, e-learning, streaming services, work from home, online fitness, video games, and many other uses of technology, have grown in current limitations.
“And many technology companies such as Netflix and Zoom are recognising these trends and seizing these opportunities to generate more income and revenue,” said Qin.
Featured image: candyapplewhip/InstagramFollow @EvaFoxU