U.S. retail investors are buying the American depositary receipts of German automaker Volkswagen AG, some market participants said, accelerating a rally spurred by well-received VW announcements on its efforts to overtake Tesla Inc in the electric vehicles market.
Volkswagen's U.S.-listed stock rose nearly 17per cent on Monday and Tuesday. By contrast, its preference shares, which comprise its main class of stock, gained almost 9per cent during the same period in Frankfurt.Since institutional investors tend to trade the company's more liquid preference shares, the outsize rise in Volkswagen’s thinly traded U.S. ADR is an indication of buying from U.S. retail investors, said Angelo Meda, head of equities at Banor SIM in Milan.
But the carmaker drew heavy interest on trading-focused social media site Stocktwits, where message volume related to the U.S. listing spiked over 70per cent, with more than 97per cent of messages reflecting positive sentiment, according to the site.
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