Retail.... 10% actually win?

So back to my original question. Why are volume and retail participation, expanding so rapidly??

 

Are defined benefit plans being phased out?

Defined benefit (DB) pension plans have fallen out of favor. Despite superior performance in providing retirement income, employers are turning away from DB vehicles and toward the use of defined contribution (DC) plans such as 401(k)s and 403(b)s as the sole savings/retirement vehicle for their employees.

IRAs and Roth IRAs come into play also...

 

everyone thinks they are exceptional?

 

Everyone thinks they are exceptional?

So you me and who else?

 

Gen Z dreams of getting wealthy without having to ever work for it in the customary ways. "It's so Boomerish."

 

I think we were on this path in 2006-2007 and then the financial crisis wiped out a whole generation of retail traders.
Finally, enough time has passed that there is a new generation of retail traders.
When we can trade with no commissions at all there should be a lot of retail trading going on. It is easy to get 2X margin and trade any stock/etf with no transaction cost other than the already tight spread.

It was the 2010s with the total absence of retail that was the oddity.

 

I know I am.

 

But back then, we didn't have the likes of the WSBs that bet against the hedge funds. Some of these FOMOs and the YOLOs on Reddit make trading look sooooooooo easy with their $1M profit per day. If I didn't know any better, I would be tempted to go along as well. Unfortunately, when the bear market comes (yet again), most of these noobs will pay for their bold mistakes dearly.

BTW never underestimate Wall Street. They are truly dirty SOBs with plenty of tricks up their ass.

 

The three game changers for a retail trader since I joined the industry in 2000:

1. Discount brokers with electronic access, cheaper commissions and easier order placement and management
2. Portfolio margin - similar to what a hedgefund can get at a Prime Broker, allows retail traders to trade similar complex strategies with moderate arbitrage style returns but high balance sheet requirements.
3. Computing power - a retail trader has access to enough computing power to calculate the risks on complex portfolios and to do their own data analysis.


4. Data access, is getting cheaper, but hedgefunds and banks have moved on to more complex and expensive datasets.

I think there's never been a time where the retail trader has a greater chance of success than now.

 

I believe it. In my opinion, learning to trade requires a full-time effort. Most retail traders can't devote a full-time effort, because they have full-time day jobs. So, what do they do?