Who Knows The Ratio of Retail Traders To Institutional Traders?

Discussion in 'Trading' started by hottpotat0, May 2, 2008.

  1. i would like to know what the real ratio is and also what is the dollar amount difference between the two camps have to play with???
    simpler question would be how many retail traders(daytraders) are there on any given trading day???
  2. I posed a similar question a couple of days ago because I'm also inclined to say that contrary to what people think, there are not too may retail tarders active in the markets at any given moment as compared to professional or institutional traders working for banks, brokerages, funds, etc.

    The only time you see greater mumbers of traders is near the top of a bubble of the bottom of a bear market. In those situation they lose not because they are out numbered but because they are wrong.

    I posted my question because I was surprised the other day when I joined a webminar of a very populer brokerage firm and found out I was the only person attending.

  3. 1) How is that of any importance? :confused:
    2) Confirmation of the obvious..........Institutional traders manage much, much, much more money than retail traders. :)
    3) Confirmation of the obvious.........The number of retail traders peaks at bull market tops and trends lower towards market bottoms.
    4) On an "average given trading day", there 12,748 retail traders. :p
  4. "How many" doesn't matter. "How much money" they control and move does.

    The institutional player is TOTALLY DOMINANT over the individual retail player... such that "retail" is irrelevant.
  5. There are around 30,000 active daytraders
    (1,000 or more trades/yr).
    Tradestation annual report has some stats.

    As other posters mentioned, although small accounts are greater than the number of institutions, their collective account balances are minuscule in comparison.

    Here are some stats to look through.

    average assets tradestation equity clients ~80k
    futures accounts ~19k
    46 trades/month
    They claim these numbers are greater than etrade, so that gives you some sample of the larger population to get a feel.
  6. There are many more than 30,000 active daytraders. IB has 99,000 accounts and the average account trades 788 times a year. Average IB account has $93,000 in equity and generates $4,645 a year in revenue.
  7. Interesting, since according to celent, in 2005 about 100,000 traders traded between 500-1,000 trades/yr (the 30,000 figure was for traders trading greater than 1,000 trades per/yr).

    To make your inference, we have to know something about how they calculate their average at IB. Assuming it's a median or mode average they would have a huge proportion of total traders by celent's figures. Their avg. number could be skewed by largest traders if they are using mean definition.
  8. so...i watched boiler room for the first time last night-intriguing
    [1] Retail money is very small in the actually causing movement of the markets
    [2] When i say retail i mean "daytraders"by SEC definition---NOT INVESTORS . investors not included in this definition
    [3] only hope of making money is riding the coatails of Institutional firms running a stock up(for a long baised position)
    or selling a stock(for a short sell position)
    [4] we really are at the mercy of larger preditory animals swimming in the sea of equities
    [5] if that is so then someone needs to develop a edge(system) for the retail daytrader so that his longevity in the markets is permanant and not based on when his account is eaten to 000000.00's
    [6] this backs up the greater fool theory which is herd menatlity driven and now media controlled-example excerpt from A.P this afternoon....(Wall Street turned in a mixed performance Friday as INVESTORS set aside some initial enthusiasm over a stronger-than-expected jobs report to lock in some of their recent gains) end quote.
    notice the media uses the term "INVESTORS" really they should say...Trading Institutions took profits today as they sold into the rally caused by better than forcasted news-or trading was sideways today as Institutional trading firms battled with eachother to take profits after the latest Instituionally led rally over the last three months.
    [7]they should leave the word Investor out of the lexicon because the investor really has nothing to do with the market except for feeding the market-because retail is most likely on the opposte side of the trade of Institutionally-broker/retail supplied fed/ led STOCK MARKET i forgot to throw in media manipulated
    [8] if there was real transparency, very few would choose to swim in these shark infested waters-or we are plankton and there are big whales out there that need food
    [9] those that choose to enter would only do so if they could be a Remora. WIKI definition:Remoras associate primarily with specific host species. Remoras are commonly found attached to sharks, manta rays, whales, turtles, and dugong (hence the common names sharksucker, whalesucker). Smaller remoras also fasten onto fish like tuna and swordfish, and some small remoras travel in the mouths or gills of large manta rays, ocean sunfish, swordfish, and sailfish.

    The relationship between Remoras and their hosts is most often taken to be one of commensalism, specifically phoresy. The host they attach to for transport gains nothing from the relationship, but also loses little. The remora benefits by using the host as transport and protection and also feeds on materials dropped by the host.

  9. Large institutions are basically trading against each other.
  10. or trapping retail between their gunfights?
    #10     May 2, 2008