Retail Investors Sell Micron, AMD, AI Stocks Ahead of SpaceX IPO

Retail investors are liquidating some of the biggest winners in the AI trade to raise cash for Friday's SpaceX (SPCX) IPO, and the selling pressure is landing hardest on semiconductors, according to data from Vanda Research cited by CNBC.

Possible Reasons

• IPO Preparation: Individual investors are freeing up cash to participate in one of the most anticipated IPOs of the year.
• Profit-Taking: After significant gains in AI stocks, some may prefer to lock in profits before reallocating capital.
• Sector Impact: Semiconductor stocks like MU, AMD, and AVGO are facing additional selling pressure from the liquidation.

Context

Vanda Research data shows that individual investors net sold equities for three consecutive days through Wednesday — the first such stretch since March 2020. On Monday alone, retail pulled the most capital from individual stocks since November 2021.

Similar Moves in the Sector

Large IPOs often cause temporary liquidity reallocation from existing stocks to the new issue, especially among retail investors. Similar patterns were seen during the IPOs of Arm Holdings and Reddit.