Last week, users of the Binance platform demonstrated an unusual market strategy: despite a decline in the stock prices of AI memory manufacturers, investment in this sector doubled, reaching $133 million. This dynamic appears particularly striking against the backdrop of an overall decline in market activity.
The total net capital inflow on the platform for the reporting period (through July 8) amounted to $169.2 million, which is 12% less than the previous week's figure. The decline is partly explained by the shortened trading week in the US due to the Independence Day holiday on July 4. However, when considering activity per trading session, demand actually increased.
Focus on AI Memory
The key driver was the technology sector, which attracted $191 million — 113% of the total weekly net inflow. Within it, stocks of AI memory manufacturers dominated, with investment volume doubling to $133 million. The leaders in inflows were SanDisk (SNDK) with $67 million and Micron Technology (MU) with $66 million. Together, these two stocks accounted for 79% of all funds directed to the memory sector.
Notably, the increase in interest coincided with a price decline. For example, on July 2, SanDisk shares lost 14% amid news of Anthropic developing its own AI chip and large-scale sell-offs by Samsung. Investors perceived the dip as an entry opportunity, buying up the cheaper stocks.
Capital Rotation and Retail Investor Strategy
Funds for purchases in the memory sector came from profit-taking in other high-tech areas. Record outflows in the platform's history were recorded in the robotics ($38 million) and space technology ($31 million) segments. Users took profits on event-driven leaders — Tesla (after record deliveries) and SpaceX (amid its inclusion in the Nasdaq-100 index).
It is important to emphasize: retail investors on Binance are acting contrary to the stance of hedge funds, which have been divesting chipmaker stocks for the fourth consecutive week. Leverage in the Micron ETF (MUU) collapsed by 72%, even though Micron shares themselves on the spot market doubled over the same period. This indicates that traders are increasing long positions while simultaneously reducing risk through derivatives.
My comment: This behavior by retail investors is a classic example of "buying the panic." However, it is worth noting that the "buy the dip" strategy in the AI memory sector may be fundamentally justified: demand for high-bandwidth memory (HBM) from data centers continues to grow. A key catalyst for the sector will be SK Hynix's listing on Nasdaq on July 10. This event could both increase interest in competitor stocks (Micron, SanDisk) and redistribute capital flows in favor of the new player. Investors should closely monitor this dynamic.