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Vested Finance, a FINRA-registered US broker-dealer and an investment platform that enables Indian investors to invest in the US markets has spotted the below mentioned trends on their platform post the tech giants announcing their earnings.

Insights with reference to Indian Investors using Vested Finance’s platform:

* Indian Investors are still interested in the tech companies. The top 25 most transacted companies on Vested platform are still tech heavy. 

* Despite a not so good earnings reports by some of the technology companies, net buying  (buy - sell) volume has remained constant. 

* Average weekly buying volume per user has remained constant. 

* Some of the stocks have witnessed an increase in buying post the results. But on a week over week or month over month basis, the trend remained constant.

* Investors continue to invest in tech-based stocks, especially megacaps and largecaps.

* Megacap stocks have been experiencing higher than average volatility in recent times. Lower earnings growth and a tightening of Fed rates could mean they may expect more pain in the short term. 

* No major buy or sell trend spotted for Meta stocks even after the prices went down post earnings announcement

* Why are investors interested in Megacap stocks?

* Two factors will work in favour of large-cap and mega-cap stocks.

First, consumption in the USA hasn’t slowed down. So the more prominent companies will continue to attract consumers despite a general slowdown across industries. This will benefit large-cap and mega-cap companies in generating steady cash flows.

Second, with the rise in uncertainty due to inflation and war in certain developed countries, investors will rush to buy the large cap and mega-cap operating globally to diversify their portfolio and minimize the overall risk.

Largely the companies are mentioning that the price per ad has decreased but the overall usage of the app has increased. For example, for META, as per the company reports, Number of ad impressions has increased +17% year over year, price per ad decreased by -18% year over year. Interestingly, fastest user growth for WhatsApp is in North America now; global daily app users (DAU) crossed 2 billion. Companies are optimistic about the long term prospects and most companies have mentioned that there can be short term volatility in the business.

In this backdrop, some investors may find an opportunity in Megacap stocks given their strong financial and steady cash flows. These companies have sufficient capital to withstand market fluctuations and may be in a better position to weather out the storm.

Please do let us know if you would require any additional inputs. We can also connect you with Mr. Viram Shah, Co-founder & CEO, Vested Finance to share further insights on the above.

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