What did Morningstar subscribers buy and sell during March?
How the most traded shares in March stack up against our analysts views.
Mentioned: Woodside Energy Group Ltd (WDS), Macquarie Group Ltd (MQG), WiseTech Global Ltd (WTC), Droneshield Ltd (DRO), Santos Ltd (STO), Vanguard All-World ex-US Shares ETF (VEU), BetaShares Asia Technology Tigers ETF (ASIA)
Sharesight is a portfolio tracker that is integrated into Morningstar Investor. Their data shows the top 20 trades by Morningstar users in March. Trading activity in March is of particular interest given the wild swings in volatility resulting from the US-Iran conflict. On top of this, investors are also navigating the structural changes in markets with AI disruption. Sharesight’s data above ranks total trading activity which is split between sells (orange) and buys (yellow).
There are six new names on the list this month compared to February. In terms of direct equities: Santos (ASX.STO), Woodside (ASX.WDS), Droneshield (ASX.DRO) and Macquarie (ASX.MQG) all saw large increases in trading activity month on month. In the ETF space, Betashares Asia Tech Tigers ETF (ASX.ASIA) and Vanguard All World exc. US ETF (ASX.VEU) made their way into the top 20. With plenty to unpack, let’s take a top-down approach and investigate the macro factors driving specific trading patterns in March.
Macro trends in March
AI disruption and the energy crisis resulting from the US-Iran conflict have impacted investor sentiment across the board. One of these events is structural while the other is cyclical. AI developments present long term structural changes to how businesses operate. Structural change is a “slow burner” due to the real world lag in implementation from government policy, infrastructure and human behaviour. The trading activity in March shows how investors are navigating the structural trend. Net positive flows into WiseTech (ASX.WTC) have remained high month on month, reflecting our analyst Roy Van Keulen’s view that AI is a tailwind for the software provider. In addition, increased exposure to ETF’s such as Asia Technology Tigers suggests investors are seeking geographically diversified exposure to growth in AI and robotics - notably in Japan and China.
In contrast, energy disruptions have a quick onset but are typically short lived. While painful, disruption to energy supply generally results in significant government intervention given the economic risks posed. Bottlenecks in oil supply impact both energy producers and refining companies. Our analyst Mark Taylor recently increased fair values for listed energy producers such as Woodside and Santos. Comparatively, refinery companies such as Ampol and Viva Energy saw slight cuts to fair value. While refinery earnings are expected to increase in the short term, higher crude oil prices tend to suppress refining margins (input costs increase). This counteracts long term earnings growth which is why fair values for refineries did not also increase.
Woodside (ASX.WDS)
- Fair Value Estimate: $43.80 (22% discount at 13 April)
- Rating: ★★★★
- Moat: None
Woodside was the most actively traded stock in March. Interestingly, the sells substantially outweighed the buys. Last month, the mix of sells and buys was almost even suggesting a shift in investor sentiment. The explanation can be pinned to the energy crisis from the US-Iran conflict. However, another explanation could be investors taking profits. Woodside is up 42% this year, following a strong February result. Woodside reported record 2025 production of 198.8 MMboe while also lowering their cost per barrel. I covered the mechanisms behind this strong result in this article.
At the onset of the US-Iran conflict, Mark Taylor increased Woodside’s fair value by 4% to $43.80. Mark expects earnings for oil and gas companies in our coverage to increase on average of 68% over the next year and 47% the following year. However, over the long run oil and gas prices are expected to decline steeply. The long-term demand for oil and gas faces a structural headwind due to increased adoption of renewable energy. The battle for Woodside shareholders is weighing up production growth vs. commodity prices. As it stands, Woodside remains undervalued trading at a material discount to fair value. The current dividend yield currently sits at 5% (fully franked).
Macquarie Group (ASX.MQG)
- Fair Value Estimate: $205 (9% premium at 13 April)
- Rating: ★★★
- Moat: Narrow
Macquarie is Australia’s largest asset manager and leading investment bank. The bank has four key segments: asset management, banking, Macquarie capital and commodities & global markets. Macquarie’s narrow moat is built on the back of three of these segments, excluding banking. Asset management benefits from high switching costs given funds have long lock up periods and institutional investors tend to have long investment horizons. Macquarie’s investment banking operations occur both in commodities & global markets as well as Macquarie capital. The investment banking arm enjoys significant network effects. The platform and web of relationships Macquarie has built gives them a sustainable advantage over other investment banks.
The increased investor interest in Macquarie shares can be partly attributed to the current energy crisis. The commodities & global markets segment benefits in times of market volatility. Higher volatility in commodities drives more client trading, hedging and market making in this segment. Overall, the shares remain fairly valued given a recent recovery in the share price in March. The current dividend yield is 3.2% (35% franked).
Vanguard All-World ex-US Shares ETF (ASX.VEU)
- Morningstar Medallist Rating: Bronze
The Vanguard All-World ex-US Shares ETF saw increased net flows in March from Morningstar subscribers. This suggests investors are increasingly seeking international exposure outside of the US. While the United States is considered a leader in AI innovation, China and Japan pose a threat. AI overspending by US tech giants as well as geopolitical risks to the US economy are real concerns investors are raising.
This ETF aims to track the performance of its underlying index, the FTSE All-World ex-US Index. This index includes both large and mid-cap stocks from developed and emerging markets excluding the US. The weighting of the portfolio is determined by market capitalisation. Geographically the exposure is greatest in Japan (15%) and China (9%) followed by countries such as the UK, Canada and France. Australian exposure in the index is only 4% which still allows for international diversification for Aussie investors.
The ETF has comparatively low fees with an expense ratio of 0.04%. This expense ratio is how much you expect to be deducted from the ETF’s value per year as fees. Our manager research team notes the absence of US exposure in this ETF has led to lower performance in recent years. However, in periods where the US share market underperforms compared to global peers, the ETF has historically outperformed.
