Exclusive: UK retail investors ‘buy the dip’ amid market collapse
UK retail investors rushed to ‘buy the dip’ at record rates as they searched for bargains amid a global collapse in stock markets following the reveal of US president Donald Trump’s tariff regime.
Buying across investment platforms has been substantially elevated, sometimes outnumbering sell orders by as much as four to one, data provided to City AM revealed.
Investment platforms have seen “a flurry of investor activity” since the tariffs came into effect, Camilla Esmund, senior manager at Interactive Investor, said.
The investment platform, which is owned by Aberdeen, recorded its highest-ever trading volumes on 7 April, with 61 per cent of trades being buys, “suggesting many investors are viewing the dip as a buying opportunity,” she said.
Other platforms such as Lightyear, AJ Bell, and Hargreaves Lansdown also reported a substantial uptick in share trading following the introduction of Trump’s tariffs.
On Hargreaves Lansdown, the proportion of buys to sells jumped as high as four to one on 8 April.
UK stocks
Investors have continued chasing the most popular stocks of the Magnificent Seven in the US, while also routing their money towards defence stocks and the UK market.
On investment platform Lightyear, investment into UK assets spiked by 174 per cent in the first two weeks of April compared to the last quarter of 2024, according to data provided to City AM.
Turbulence caused by Trump’s tariffs has been the clear cause for this, as the first two weeks of April accounted for more than half of the increase in UK assets since the start of the year.
Similar performance was recorded on other investment platforms, with Hargreaves Lansdown reporting that UK-focused trades outnumbered US stocks by three to one.
The move will have paid off for UK investors, as the FTSE 100 is up more than two per cent since the start of 2025, compared to a seven per cent drop in the S&P 500.
UK investors buy into Mag Seven
Meanwhile, investors have been flocking to buy more stock in the US tech giants of the Magnificent Seven as prices plummeted over fears of a slowdown in the global economy.
The average Magnificent Seven stock has fallen around 18 per cent since the start of 2025, with Tesla’s share price falling by as much as a third.
Now, the top three buys among funds and ETFs for UK investors on Lightyear are all members of the Magnificent Seven: Nvidia, Tesla, and Amazon.
“We saw some customers attempting to take advantage of market volatility by buying quality companies during the dip,” added Interactive Investor’s Esmund.
“These tended to be the ‘Magnificent 7,’ or the well-known blue-chip stocks which are familiar names on interactive investor’s monthly most bought investment list.”
However, it seems that the wider US stock market may be beginning to fall out of favour, as inflows in US equities dropped from 43 per cent of all investment from the UK in December to 37 per cent throughout this year, data from Lightyear revealed.
In its place, the aerospace and defence industry has been a popular pick, with Lightyear’s retail investors upping their assets in the sector by 94 per cent since January.
“The political context in which investors operate has changed, and continues to change fast,” Wander Rutgers, UK CEO of Lightyear, said. “We can see Brits recognise the opportunities that defence equities present.”
Since the government announced its commitment to boost defence spending to 2.5 per cent of GDP at the end of February, UK assets in defence and aerospace stocks have increased by 50 per cent, he added.
“We’ve also just been through the tax year end meaning lots of customers have topped up their ISAs and pensions to use any allowances they had remaining last year and the new allowances that have become available this tax year,” noted Charlie Musson, managing director of AJ Bell’s investment platform for DIY investors.