Rising US retail stock trading will draw modest reform

Significance

Late-phase bull equity markets invariably spawn a new generation of novice, casual traders. The surge in popularity of free stock trading apps such as Robinhood, combined with the growth of investing-focused social media channels, is influencing retail investment in a particular way this time around.

Impacts

• Institutional investors will continue to drive the overwhelming majority of stock trading activity.
• Attempts to use the GameStop short squeeze to introduce a financial transactions tax will advance, but not far.
• Unprecedented access to more sophisticated financial information and trading tools will make retail investors more active investors.
• Digital financial apps ('robo advisors') that use artificial intelligence to manage individual investors' assets will continue to grow.