Investments you had your eye on in 2021
A rout in tech stocks triggered by Beijing's crackdown has investors' eyes on China.
Google released its Year in Search report earlier this month - a look at what was trending in 2021. After almost two years of lockdowns, social distancing vaccinations, it’s unsurprising the pandemic powered a lot of the googling with searches like 'COVID NSW' and 'QLD COVID Update' on the list. Globally, meme stocks and cryptocurrencies like 'AMC' and 'Dogecoin' rivalled major news events as the biggest searches this year, showing how retail investors stole the show in 2021.
In this spirit, we’re also sharing the most popular securities on Morningstar. We're looking at the most frequently searched Australian stocks, global stocks and funds this year.
Banks and Mining
While 2020 was all about stocks beaten down by the pandemic, 2021 resembled pre-covid trends. Firms offering a unique opportunity to buy at depressed prices including Qantas, Flight Centre and Southern Cross Media have fallen off the list in favour of firms tied to booms in the price of iron ore and cleaner energy minerals. Names like Forestcue Metals (ASX: FMG) and Lynas Rare Earths Ltd (ASX: LYC) featured alongside BHP Group Ltd (ASX: BHP).
The rebound in oil prices saw renewed interest in producers Woodside Petroleum (ASX: WPL) and Santos (ASX: STO). This followed a record decline in prices in 2020 as the pandemic closed factories, interrupted trade and stalled international travel.
Then there were the names that appeared following dramatic underperformance - Magellan Financial Group (ASX: MFG) down 55% this year, a2 Milk (ASX: A2M) down 51% and AGL Energy (ASX: AGL) down 42%.
China and US Tech
On the international front, Chinese tech firms Alibaba Group (BABA) and Tencent (TCEHY) featured as Beijing moved to exert control over the tech sector. The Hang Seng Tech Index, representing the 30 largest technology companies listed in Hong Kong, has nearly halved from a February peak.
But eyes were also on US mega-tech with Amazon (AMZN), Microsoft (MSFT), Apple (APPL) and Tesla (TSLA) leading the list. Just five stocks — Microsoft Corp, Alphabet Inc (GOOGL), Apple Inc, Nvidia Corp and Tesla Inc — contributed over a third of the S&P 500 Index’s SPX 26% total return for 2021 through December 9, according to analysts at Goldman. However, as the year draws to a close, several names have dragged the indexes lower as investors assess the implications of the omicron variant, inflation and the removal of stimulus measures.
MORE ON THIS TOPIC: Why investors can't ignore Tesla
ETFs and Going for Growth
ETF Securities' Battery Tech and Lithium thematic ETF (ASX: ACDC) jumped to the top of the list following its top-ranking performance in 2020. Electric vehicle stocks soared on hype in 2021 as investors poured money into Rivian and Lucid Motors. Technology-focused ETFs featured prominently with entries from BetaShares Asia Technology Tigers ETF (ASX: ASIA), ETFS Morningstar Global Technology ETF (ASX: TECH) and BetaShares NASDAQ 100 ETF (ASX: NDQ).
Investors showed a preference for growth-orientated strategies, looking at large-cap global equity funds from Hyperion Asset Management, Walter Scott and T. Rowe Price. Hyperion was awarded Morningstar's Fund Manager of the Year in 2021 after consistently outperforming peers and indices.
Vanguard strategies also featured prominently, most notably their range of multi-asset index funds in both unlisted and ETF form. Magellan Global continued to feature up-top despite notching a second year of underperformance.
Only one listed investment company make the top 20 - Australian Foundation InvesCo Ord AFI.