Despite market volatility, retail investors went on a buy-the-dip spree. These are the stocks they picked up, says Vanda.

Amid concerns over the health of smaller lenders, they bought “unprecedented amounts” of too-big-to-fail banks, amounting to to nearly $1 billion of retail inflows to financials over the past five days. Vanda’s chart shows the last five day’s net purchases with financials standing out:

Marco Iachini, senior vice president, Giancomo Pierantoni, head of data and Lucas Mantle, data science analyst at Vanda, said Charles Schwab
SCHW,
-2.54%
saw the second-most inflows following Bank of America over the past week.

“Some adventurers” were buying First Republic Bank ,
FRC,
-32.80%
PacWest Bancorp
PACW,
-18.95%
and Truist Financials
TFC,
-7.23%,
which they described as “riskier bets that could potentially offer massive upside” if systemic risk can be held at bay.

Stocks climbed Thursday after federal authorities organized major banks to infuse $30 billion into First Republic Bank
FRC,
-32.80%
and stave off a fourth banking collapse, following the failures of Silicon Valley Bank, Signature Bank and Silvergate Bank over the past week . Credit Suisse shares
CSGN,
-8.01%,
meanwhile tumbled 25% last week, shaking global markets at times amid worries for the Swiss banking giant’s own survival.

Read: UBS and regulators rush to seal Credit Suisse takeover deal: reports

Yet the roller-coaster ride was back on Friday, with financials pressured and shares of First Republic tumbling anew after the bank suspended its dividend and disclosed higher borrowing costs. Some of the big banks involved in that deposit plan for the lender were also dropping, such as JPMorgan Chase & Co.
JPM,
-3.78%,
Citigroup
C,
-3.00%,
Bank of America
BAC,
-3.97%
and Goldman Sachs
GS,
-3.67%.

For the week, the Dow fell 0.1%, the S&P 500 gained 1.4% and the Nasdaq Composite jumped 4.4%, according to Dow Jones Market Data,

Schwab shares lost 3.9% last week, during which at one point executives were assuring shareholders that the broker remained “well positioned.” CEO Walter Bettinger and other executives bought up nearly $7 million in shares during last week’s market turbulence.

The Vanda analysts said part of that equity sector rotation has likely been driven by profit-taking on the side of bond-themed exchange-traded funds (ETFs), with inflows into some of the largest of those falling $250 million over the past two weeks.

But it’s a delicate balance right now, with those investors only likely to keep buying stocks provided a “systemic crisis” can be avoided, said Vanda analysts.

Read: Credit Suisse shares fall to cap its worst week since 2008 financial crisis

Read: Consumer sentiment falls for first time in four months — and that was before Americans knew about SVB

Uncertainty about the Fed’s interest rate path has caused bond yields to be volatile in the past week, sending the ICE BofAML MOVE Index to its highest level since the 2008 financial crisis as of Wednesday.

Investors pulled $8.8 billion flow out of prime money-market funds at Schwab last week, putting it into the broker’s government and Treasury funds amid ongoing nervousness over whether more shoes will drop in the banking crisis, Bloomberg reported, citing company data.

Vanda said the energy sector also saw surging inflows after Tuesday’s market slump, though the analysts said those aren’t the stocks that tend to draw loyalty from traders, therefore if a surge in dip-buying doesn’t turn that momentum around, more traders could dump those shares.

Haunted by the ghosts of late 2018 and the 2008 financial crisis, retail investors are in a fragile situation, said the Vanda analysts.

They noted that capitulation for investors in 2018 came in the fourth quarter, “when the equity market began to free fall after a prolonged range bound period amid mixed Fed commentary.” The S&P 500 index slid over 9% in December 2018 amid concerns over Fed tightening, an economic slowdown and U.S.-China trade tensions.

Markets are bracing for next week’s Federal Reserve policy meeting. In fed funds futures traders now see a 75.3% chance of a 25 basis point rate hike next Wednesday, owing to inflation worries. That as banking stress hovers in the background.

Read: What it may take to calm banking sector jitters: time, and a Fed rate hike.

“We also believe that fears of ‘systemic risk’ related to the banking sector are more emotionally destabilizing for unsophisticated investors than any marginal selloffs caused by Fed interest rate hikes or events outside the U.S.,” said Vanda analysts.

“We remain on watch as we could see increased volatility in flows over the coming weeks, particularly if retail traders panic and begin moving more of their assets into money-market funds.”

Such funds are perceived as safer because the investments are focused on lower-risk areas such as cash and securities that behave like cash, such as CDs and Treasury bills.

One stock that isn’t getting any dip-buying love they note is Tesla
TSLA,
-2.17%,
which continues to underperform the broader market since a disappointing Investor Day earlier this month, said the Vanda team. Tesla shares have lost 13% this month, versus a 1.3% gain for the Nasdaq Composite
COMP,
-0.74%.

“We believe that in this environment, TSLA could continue lagging as investors now have the opportunity to pick from other familiar pockets of the stock market that have recently been battered, like energy or financials,” they said.

Read: Every hiking cycle over the last 70 years ends in recession or a financial crisis. ‘It’s not going to be different this time,’ Morgan Stanley strategist says.