Advisers appeared to take a dual approach to the volatility that rocked markets in early April after US President Donald Trump announced wide-ranging tariffs on Liberation Day. AUSIEX trading data suggests many are positioning for a broad recovery via exchange traded funds (ETFs), while also switching blue chip holdings.

The 10 most bought securities by advised clients in the period from April 4 to April 11 – when global stockmarkets swung widely – were equally split between direct shares and ETFs. The most bought stocks included resource companies BHP Group (ASX: BHP) and Woodside (ASX: WDS).

Advisers also appeared to take the opportunity to pick up biotech CSL (ASX: CSL) at a lower price after it dipped in response to US plans for a major tariff on pharmaceutical products. Macquarie Group (ASX: MCQ) was another popular buy amid the volatility after falling from above $221 in early January to as low as $170.97 on April 9.

“Advisers appear to be sticking to basic principles that often guide investors in volatile markets. This includes cautiously deploying capital as opportunities arise to pick up favoured stocks relatively cheaply, while also using ETFs to capture broad market trends,” says Chris Hill, National Manager, Strategic Relationships.

The most sold shares by advised clients from April 4 – April 11 were almost exclusively direct shares. Commonwealth Bank (ASX: CBA) again headed the list as advisers appeared to continue reweighting clients’ portfolios after the record-breaking run in the banking giant’s share price.

Telstra (ASX: TLS), Woolworths (ASX: WOW), Westpac Banking Corporation (ASX: WBC) and Fortescue (ASX: FMG) rounded out the five-most sold companies.

The AUSIEX analysis was based on a sample of a large cohort of its trading data.

Most bought ETFs

The fortunes of the Australian dollar figured in advisers strategies, with the hedged version of VanEck’s MSCI International Quality ETF (ASX: QHAL) ranking as the most bought ETF (and fifth-most bought security overall) during the turmoil. The unhedged version of this product consistently ranks among the most bought ETFs by advisers who use the AUSIEX trading platform. However, a slump in the $A in early April seems to have encouraged some to opt for the hedged version to negate the impact of a recovery in the local currency.

Vanguard’s MSCI International Shares (Hedged) ETF (ASX: VGAD) was another of the most bought securities in the market upheaval, alongside its unhedged counterpart and Vanguard’s Australian Shares Index ETF (ASX: VAS).

“Advisers and their clients largely had little appetite for ETFs outside these mainstream index products when markets were at their most volatile, with few of the niche equity products popular in previous months figuring in advisers trading activities,” says Chris.

An exception was a smaller group of advisers who opted for leverage to maximise potential gains in a market recovery by building client position in both Betashares’ Geared US Equities Currency Hedged Complex ETF (ASX: GGUS) and Geared Australian Equities Complex ETF (ASX: GEAR).

Interestingly, Betashares Australian Bank Senior Floating Rate Bond ETF (ASX: QPON) was the only fixed interest product to figure among the top ETF buys by advised clients from April 4 to April 11.

This was at odds with trading activity earlier in the year when the asset class featured heavily in the most bought ETFs by this class of investor – perhaps in anticipation of the volatility to come.

Advisers traded a combination of direct blue chips and ETFs in the market turmoil following President Trump’s Liberation Day, with their buys and sells giving an indication of their strategies for navigating the volatility.

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