The recent sharp fluctuations in US technology leading stocks have aroused many investors' attention to the participation of individual investors in the US stock market.This worry is not without reason.In the early days, US technology leaders rose too much, showing the characteristics of crowded and clustered trading, as well as the recent sudden and rapid decline, there seems to be too much retail trading leading to speculative behavior.

This worry is not impossible.Although u.s. stocks are institution-dominated, we estimate that the direct ownership of residents is about 31%.

However, since the epidemic, in order to deal with the huge impact of the epidemic on the economy, employment and residents' income, the transfer payments made by the government through direct subsidies, wage protection plans and unemployment assistance have not only completely offset the loss of wage income caused by unemployment in the residential sector, but also led to a substantial increase in disposable income. as of July, the household savings rate was still as high as 17.8%. Superimposed during this period, most residents are isolated at home, so it is not impossible for some money to flow into the stock market.

So how much of this goes into the stock market? Or how much of this rally in the stock market was contributed by individual investors?Unlike U. S. stock holdings and position data, the Fed's financial account table provides a quarterly update of the detailed split, while U. S. stock trading data has not been a better overall data. In order to measure the transaction contribution of retail investors to this market rebound, we estimate indirectly through three dimensions: the main retail trading platform in the United States, the inflow of ETF funds with different types of investors, and the size of margin trading. Specifically,

i. Since the epidemic, the commission fees of the five major trading platforms in the United States have continued to increase, and retail activity remained high in the second quarter.16~17%。

At the end of 2019, SEC requires brokers to publicly disclose the relevant trading information of their individual investors and institutional investors on a quarterly basis (monthly data). We selected the five major retail trading platforms for US stocks, Robinhood, E-trade, TDAmeritrade, Charles Schwab, and Fidelity, and calculated the commissions and fees (Netpayment received) and net income per share (Netpayment received per share) generated by each institution's monthly trading orders, respectively, so as to calculate its implied trading volume.

Since the beginning of the year, the monthly commissions and fees of the five major retail trading platforms have continued to rise. Commissions and fees of Robinhood and TDAmeritrade at the end of March increased by 73.9% and 55.7% from the end of February, while the latest figures for the end of June also increased by 72.0% and 40.7% compared with the end of May.

Further, if we compare the monthly implied trading volume of the five major retail trading platforms with the overall trading volume of the US stock market, we can see that the proportion of retail trading volume jumped from 7.76% in January to 17.5% in April. The proportion of transactions remained high from May to June, accounting for 15.9% and 17.4%. This level is also basically in line with Bloomberg Intelligence's estimate of 19.5%.

This level is also significantly higher than the historical normal level.

Since the SEC data mentioned above only started in 2020, it cannot be compared with the longer historical cycle, so we chose the average daily trading earnings (DARTs) of the three major retail trading platforms for US stocks as a reference, which jumped from about $1.5 million at the end of the fourth quarter of 2019 to about $6 million in the second quarter of 2019. In addition, the same is true of Bloomberg Intelligence's estimate. Compared with institutional investors such as market makers and hedge funds, individual investors in us stocks have been in a range of 10-15 per cent since 2010, but that proportion has soared to 19.5 per cent since 2020.

ii.The investment adviser is the head of Jiakang American stocks since the bottom.ETFThe main force. As we analyzed in "who is adding positions in US stocks?", compared with the quarterly investor position changes disclosed by institutions and individual stocks, ETF has more timely updated daily capital flow and investor position data, so it can be used as an approximate representative of observation. Of course, it must be stated that only looking at the head ETF can not reflect the overall picture of the market, there is bound to be a certain deviation.

By observing the investor holdings of the top 20 US stock ETF of AUM since March 23, we find that the investors who have increased their holdings the most since the market rebound of the top 20 US stock ETF at the end of March are investment advisers (Investment Advisor, that is, relatively more financial and investment advisers for high net worth individual clients), which are significantly ahead of other types of investors; their absolute holdings have increased by US $31.1 billion, nearly twice as much as the second-largest bank customers.

iii.Both own funds and financing balances have increased significantly.Brokerage financing data from FIRNA show that both customer-owned funds (credit balance) and financing balances (debit balance) have increased significantly in the year to July, especially customer-owned funds (more than $400 billion), which is significantly higher than the normal level of the past 10 years since 2008 (about $350 billion). Since direct financing is generally considered to involve more individual trading accounts, the increase in this scale can also reflect the enthusiasm of individual investors to enter the market.

To sum up, it can be found from the calculation and verification of many dimensions.Individual investors have indeed participated in this market rebound to a considerable extent, and activity has risen significantly compared with the previous one, so it may have magnified the rise and fall of the market to some extent.。