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Just how much of the market do retail investors control? I thought they were a drop in the bucket. Also, is there a way to know how much of the total volume of

by torginus 11mo ago

Just how much of the market do retail investors control? I thought they were a drop in the bucket. Also, is there a way to know how much of the total volume of shares is being traded now? If I kept hyping my company (successfully), and drove the share price from $10 to $1000, thanks to retail hype, I could 100x the value of my company lets say from $100m to $10B, while the amount of money actually changing hands would be miniscule in comparison.

theptip 11mo ago
Retail is a big deal these days. Used to be sub 10%, now it’s in the 30-40% of daily volume range IIUC. You can easily look up the numbers you are asking for, the TLDR is that the volume in most stocks is high enough that you can’t manipulate it much. If it’s even 2x overpriced then there’s 100m on the table for whoever spots this and shorts, ie enough money that plenty of smart people will be spending effort on modeling and valuation studies.
- tonyedgecombe 11mo ago
  >Retail is a big deal these days. Used to be sub 10%, now it’s in the 30-40% of daily volume range IIUC. This isn't going to end well is it.
- hvb2 11mo ago
  > Retail is a big deal these days. Used to be sub 10%, now it’s in the 30-40% of daily volume range IIUC. But that isn't relevant? If they trade a lot but own less than 10% of the shares they're still a small piece. The institutional investors are likely not trading much, things like 401k are all long term investments
andrew_lettuce 11mo ago
When you add in money managed on behalf of retail investors it gets big fast, thinking indexed funds, pensions etc. they are not immune, and ETFs by definition need to participate
- baobabKoodaa 11mo ago
  You are correct in the main thing you were trying to communicate, but I'll just correct this part: > ETFs by definition need to participate You meant to say "index funds". There are many different kinds of ETFs.
- wyre 11mo ago
  Is that not considered institutional? If i own a Vanguard ETF, the stock that comprises the ETF is classified as being owned by Vanguard, right? Genuinely asking.
chollida1 11mo ago
Retail has gotten alot bigger lately( last 10 years and mostly since covid) and alot more "organized". Goldman puts out their retail reports weekly that show retail is 20% of trading in alot of names and higher in alot of the meme stock names. They used to be so tiny due to $50/trade fees, but with the advent of all the free money in the system since covid and GenZ feeling like real estate won't be their path to freedom, and option trading for retail, and zero commission trading retail has a real voice in the markets.
- Cheer2171 11mo ago
  That is 20% of trading volume, a lot of which is day/week trading, which goes up the more they buy and sell to each other. This does not mean 20% of their assets under management are retail. The "voice" of the retail market is still tiny, it is only because institutional investors are betting with each other off what reddit is going to do that things actually move.

theptip 11mo ago

Retail is a big deal these days. Used to be sub 10%, now it’s in the 30-40% of daily volume range IIUC. You can easily look up the numbers you are asking for, the TLDR is that the volume in most stocks is high enough that you can’t manipulate it much. If it’s even 2x overpriced then there’s 100m on the table for whoever spots this and shorts, ie enough money that plenty of smart people will be spending effort on modeling and valuation studies.

tonyedgecombe 11mo ago
>Retail is a big deal these days. Used to be sub 10%, now it’s in the 30-40% of daily volume range IIUC. This isn't going to end well is it.
hvb2 11mo ago
> Retail is a big deal these days. Used to be sub 10%, now it’s in the 30-40% of daily volume range IIUC. But that isn't relevant? If they trade a lot but own less than 10% of the shares they're still a small piece. The institutional investors are likely not trading much, things like 401k are all long term investments

andrew_lettuce 11mo ago

When you add in money managed on behalf of retail investors it gets big fast, thinking indexed funds, pensions etc. they are not immune, and ETFs by definition need to participate

baobabKoodaa 11mo ago
You are correct in the main thing you were trying to communicate, but I'll just correct this part: > ETFs by definition need to participate You meant to say "index funds". There are many different kinds of ETFs.
wyre 11mo ago
Is that not considered institutional? If i own a Vanguard ETF, the stock that comprises the ETF is classified as being owned by Vanguard, right? Genuinely asking.

chollida1 11mo ago

Retail has gotten alot bigger lately( last 10 years and mostly since covid) and alot more "organized". Goldman puts out their retail reports weekly that show retail is 20% of trading in alot of names and higher in alot of the meme stock names. They used to be so tiny due to $50/trade fees, but with the advent of all the free money in the system since covid and GenZ feeling like real estate won't be their path to freedom, and option trading for retail, and zero commission trading retail has a real voice in the markets.

Cheer2171 11mo ago
That is 20% of trading volume, a lot of which is day/week trading, which goes up the more they buy and sell to each other. This does not mean 20% of their assets under management are retail. The "voice" of the retail market is still tiny, it is only because institutional investors are betting with each other off what reddit is going to do that things actually move.