Why are BrainChip (ASX:BRN) shares smashing ASX 200 trading volumes today?

The artificial intelligence tech company’s share price is also sinking…

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It certainly hasn’t been a good day for BrainChip Holdings Ltd (ASX: BRN) shares. For one, the BrainChip share price is currently down by a nasty 12.34% so far this Friday. At the time of writing, BRN shares are sitting at $1.74 each. That puts it a depressing 25.6% away from the record high of $2.34 a share that we saw just earlier this week.

What’s more, the steep share price drop has also arguably driven this company to the top of the trading volume charts today, in the process beating out several far larger ASX 200 shares.

BrainChip shares top the ASX 200 on trading volume charts

According to investing.com, the S&P/ASX 200 Index (ASX: XJO) shares currently topping today’s volume charts (at the time of writing) are as follows:

  • Telstra Corporation Ltd (ASX: TLS), with 18.15 million shares traded
  • Pilbara Minerals Ltd (ASX: PLS), with 19.66 million shares traded
  • Whitehaven Coal Ltd (ASX: WHC), with 20.8 million shares traded

But BrainChip has absolutely demolished these ASX 200 shares in terms of trading volumes thus far today. A whopping 60.05 million BrainChip shares have been bought and sold this Friday at the time of writing, almost triple that of Whitehaven Coal, the next most-traded ASX share of the day.

As to why the BrainChip share price has lost so much of its value, the answer is far less clear. There has been no news or announcements out of the artificial intelligence technology company today.

As my Fool colleague James commented earlier this Friday, “this appears to have been driven by profit-taking after some very strong gains in recent weeks… Investors may also be questioning whether a company with such little revenue warrants a valuation of over $3.5 billion”.

This makes sense. Even though the company has given back double-digits today, it’s still up by more than 150% in January alone. It’s also up by more than 350% since early October last year.

After gains like these in such a short space of time, many investors can be tempted to take profits off the table. That might explain why BrainChip shares are smashing the other ASX 200 companies today in terms of raw trading volume.

At the current BrainChip share price, this company has a market capitalisation of $3.4 billion.

Should you invest $1,000 in BrainChip right now?

Before you consider BrainChip, you'll want to hear this.

Motley Fool Investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now... and BrainChip wasn't one of them.

The online investing service he’s run for over a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.* And right now, Scott thinks there are 5 stocks that are better buys.

*Returns as of January 13th 2022

Motley Fool contributor Sebastian Bowen owns Telstra Corporation Limited. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia owns and has recommended Telstra Corporation Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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