New data from online investing platform eToro reveals a strong preference among Perth investors for investing in S&P/ASX 200 Index (ASX: XJO) mining stocks like BHP Group Ltd (ASX: BHP) shares.
The data showed that investors across Australia's other capital cities had their own investing penchants.
Investors in Brisbane, for example, invest more heavily in healthcare stocks than those in the other big cities.
Syndey investors, on the other hand, have a stronger leaning toward listed luxury brands and fast-food stocks like Domino's Pizza Enterprises Ltd (ASX: DMP).
And Melbourne investors have a proclivity for listed dating apps as well as cannabis-related stocks.
But in Perth, BHP shares and other leading ASX 200 mining stocks take the top spot.
Commenting on the significant investing differences between the capital cities, eToro market analyst Josh Gilbert said, "Investing in what you know is the mantra of many of the world's successful investors, including Warren Buffett."
Gilbert continued:
Therefore, it's great to see that investors are using the same approach. Investors seem to be leveraging their local knowledge and market familiarity, which can provide an edge, especially given how important it is to understand how a business makes its money.
Mineral Resources and BHP shares to the front of the line
When it comes to ASX 200 mining stocks like BHP shares, Perth residents are indeed likely to have a knowledge edge over those from the other capital cities.
Western Australia, after all, holds some of the world's richest mineral deposits and thus has drawn in some of the world's top miners.
According to the data from eToro, Perth investors are almost three times as likely to buy Mineral Resources Ltd (ASX: MIN) shares, with the stock counting as 267% over-indexed.
BHP shares come in a close second, 240% over-indexed, while Rio Tinto Ltd (ASX: RIO) shares were 146% over-indexed by Perth investors.
Lithium miner Pilbara Minerals Ltd (ASX: PLS) also came in among the most over-indexed stocks by Perth investors. In fact, eToro noted that 10% of the city is investing in Pilbara Minerals shares.
Commenting on the strong leaning for mining stocks like Mineral Resources and BHP shares in Perth, Gilbert said:
It's no wonder that Perth, being a major hub for the mining industry, has a high concentration of investors holding mining stocks. The city's economic ties to this sector likely influence local investment preferences.
Companies like BHP, Rio Tinto, and Fortescue Metals Group Ltd (ASX: FMG) are mainstays in portfolios, reflecting confidence in the enduring value of natural resources.
