The Rise of Retail Investors

The Era of Small Investors: How They Would Reshape Wall Street After 2025?

Recent stock market moves are no longer just driven by large asset managers and institutional players. The year 2025 proved that small investors, also known as retail investors, now wield significant power in the U.S. stock market. The numbers speak for themselves: the capital influx from small investors into the stock markets in 2025 exceeded the previous year by 53 percent, surpassing even the 2021 record year propelled by the meme stock frenzy by 14 percent.

Background of the Small Investor Renaissance

Several factors contribute to the rise of small investors. On one hand, low-cost and commission-free trading platforms, such as Robinhood or Interactive Brokers, have made stock market investments more accessible to a wider audience. There is no need for large initial capital, lengthy registration processes, or bank connections — just a smartphone and an app, and the world's largest market is open to you.

On the other hand, during the pandemic, many people found themselves confined at home, and some of them sought out a new hobby: stock trading became the new entertainment. Meme stocks like GameStop and AMC initiated a community-based investment wave that has not entirely disappeared.

2025: A Year of New Records

According to J.P. Morgan data, small investors already accounted for 20–25 percent of total trading activity in 2025, reaching 35 percent in April. This presence not only implies influence but also market-shaping power. When President Donald Trump announced new tariffs in April, triggering a global sell-off wave, small investors calmly bought discounted quality stocks — this strategy contributed to the S&P 500 reaching a new high.

Among the most popular stocks remain Tesla and Nvidia, frequently mentioned as “favorites” of small investors. Companies focused on artificial intelligence, like Palantir Technologies, also received significant attention — small investors bought eagerly while institutional investors withdrew due to valuation concerns.

Themes and Trends: ETFs, Technology, Thematic Investment

In 2025, the strategy of small investors became more sophisticated. While impulsive buying driven by social media was typical before, now more people are turning towards long-term, thematic investments. Technology still dominates attention, but more and more are discovering sectors like uranium mining, rare earth element extraction, or quantum computing.

Additionally, the rise of ETFs (exchange-traded funds) is remarkable. These instruments simplify portfolio building, are transparent, and feature favorable tax rules. It is no coincidence that among the most traded products on platforms such as eToro were ETFs like the Direxion Daily Semiconductor 3X Bull and Bear.

2026: What’s Next?

Experts believe the presence of small investors is not just a fleeting trend. After a successful year, many will return in 2026, especially if rate cut expectations come to fruition and markets receive a new boost. Nasdaq is getting closer to introducing 24-hour trading, which could further enhance retail participation — the nonstop accessibility aligned with global time zones is not a dream but soon a reality.

However, due to market uncertainty, potential overvaluation of artificial intelligence stocks, and possible volatility, many believe that the peak performance of 2025 will be hard to replicate. Some analysts suggest opening up to other sectors: ETFs in finance, energy, gold mining, or communications companies could also perform well.

Conclusion: A New Era Has Begun

The past year has shown that small investors are not merely lurking figures at the market's hinterland — rather, they are active shapers of capital market trends. Technological advancement, mobile apps, and social platforms have democratized investments, allowing an average American to access the same information and tools as a Wall Street trader.

The strength of retail investors is now an undeniable fact. The year 2026 will indeed provide more examples of how small players can exert a significant impact — not just on the price of individual stocks but on the overall market mood.

The investment world will never be the same again. And the flag bearers of this new era are the small investors.

(The article is based on accounts from market participants.) img_alt: New York Stock Exchange at the corner of Wall Street and New Street.