JPMorgan finds new positive factor for US stocks growth
Retail investors are poised for a return to the U.S. stock market, analysts say - after their share of total U.S. stock trading volume fell to a four-year low - private investors will gradually resume their activism
Retail investors will increase their share of the equity market, further boosting the U.S. stock market, analysts say / Photo: Tada Images/Shutterstock
The share of retail investors in the total volume of trading in U.S. stocks will begin to increase after falling to a four-year low at the end of the first quarter, according to analysts at JPMorgan Chase. According to strategists, this may become another stimulus for growth of the stock market, Bloomberg writes.
Details
"Although retail investors' share of U.S. equity trading volume fell to 17% in the first quarter, we expect a rebound in the second quarter - similar to the second quarter of 2025," JPMorgan's team of analysts led by Nikolaos Panigirtzoglou said in a report. This momentum, the strategists estimate, will be aligned with the revitalization already seen in the options segment: "Purchases of call options (contracts to buy assets at a set price by a set date. - OnInvest) by small traders sagged between October 2025 and March 2026, but rose sharply in April-May," the analysts added.
Similarly, according to JPMorgan, the dynamics of the S&P 500 index in 2025 and 2026 look similar: subdued results in the first three months of the year are replaced by a powerful rally in the second quarter. For example, private investors were actively trading individual stocks in 2025 during this period, but they have since reduced speculative activity (except for a spike in October 2025), the analysts noted. Now, renewed retail investor activity in the market could give U.S. equities a boost, JPMorgan said.
"Despite the downturn [in private investor activity] in the second half of 2025 and first quarter of 2026, retail investors still accounted for about 20% of U.S. equity trading and nearly 50% of short-term options trading volume," the analysts emphasized.
At the same time, another group of more traditional retail investors, preferring equity funds (ETFs), has provided the market with constant support - even during the general slowdown in activity, the analysts noted. JPMorgan adds that what matters more to the market is not how often individuals transact in stocks or options, but their share in the total capital flows of end investors.
Context
For 2025, the S&P 500 has added about 16%, since the beginning of 2026, it has grown by more than 10%, and at the close of trading on Ma 27, it updated its historical high at 7520.36 points. The U.S. market is mainly supported by the shares of large technology companies on the back of the AI boom.
This article was AI-translated and verified by a human editor
