The buy/sell ratio in Lloyds Banking Group was 7:1 on Friday

Private investors pile into Lloyds shares
Private investors who bought shares in Lloyds Banking Group outnumbered sellers by seven to one at one London stockbroker as the shares plunged following news of huge losses at HBOS.

By Richard Evans
Last Updated: 6:11PM GMT 16 Feb 2009

"The buy/sell ratio in Lloyds Banking Group was 7:1 on Friday," said TD Waterhouse, a broker that specialises in "execution only" trades – those where investors make their own decisions.

Strong demand for the bank's shares continued on Monday – the ratio was two to one in favour of buyers, after Lloyds shares fell by 20pc on the opening of the market in London. By midafternoon, the shares were trading at 57p.

Investor interest was first triggered on Friday when Lloyds' share price fell by 32pc, closing at 61.4p as institutional investors sold the shares following news of losses of almost £11bn at HBOS, the troubled bank that Lloyds bought last year.

TD Waterhouse said: "Lloyds Banking Group accounted for 40pc of the top 10 trades by our customers on Friday. On Monday Lloyds again was the most traded stock."

It added: "The data indicates that our frequent traders are looking to turn a quick profit on the volatility of banking stocks, and Lloyds in particular."

Tom Diavolitsis, a director of TD Waterhouse, said: "Lloyds was the number one traded stock by our customers on Friday last week and in the first two hours of trading today [Monday].

"It is clear that our investors are hoping to take advantage of the recent volatility in the Lloyds share price. Some will be looking to make a short-term profit, others may be looking to gain by holding the stock for the longer term."

It was a similar story at Stocktrade, the execution-only division of Brewin Dolphin, another stockbroker. Lloyds accounted for 25pc of the division's trades on Monday morning; 56pc of the Lloyds orders were buys and 44pc were sells.

Royal Bank of Scotland accounted for 7pc of trades – 63pc of them buys and 37pc sells. Buy orders for Barclays shares outnumbered sales by three to one.

Brewin Dolphin said its view for investment management clients was that the Government would nationalise Lloyds only as a very last resort. "We are not that close to a last-ditch scenario just yet, though very much aware of the strong economic head winds.

"The current Lloyds share price is acting like a warrant; if they can survive we believe there is significant longer-term upside."

http://www.telegraph.co.uk/finance/personalfinance/investing/shares/4640868/Private-investors-pile-into-Lloyds-shares.html