TL;DR
- Retail investors, fueled by events like GameStop and cryptocurrencies, are consolidating as a formidable force in the markets.
- The modern retail investor shows a shift towards derivatives trading and zero-day options, seeking more complex strategies.
- The influence of 24/7 cryptocurrency trading is redefining the hours and expected flexibility in traditional stock markets.
Over the past five years, a profound transformation has been brewing in the investment landscape, thanks to a confluence of catalyzing factors that have consolidated the presence of the modern retail investor in financial markets.
What began with the rise of cryptocurrencies and opportunities in prediction markets powerfully spread to the stock market, reaching its peak with the GameStop “short squeeze” event in 2021. This achievement, led by trader Keith Gill, not only propelled GME’s price to record levels but set a precedent: retail traders were here to stay.
Since then, retail participation has grown exponentially, becoming more audacious and sophisticated. A Bloomberg analysis confirms that retail and “meme” traders will not only persist but are gaining experience and adopting more reasonable strategies.
This phenomenon has been reinforced by post-pandemic behavior, with a return to activity not seen since the 2025 market, according to a J.P. Morgan Chase report. Steven Quirk, chief brokerage officer of Robinhood Markets Inc., emphasizes: “Retail is a force in this space. I don’t see that changing.”
Sophistication in Strategies and the Influence of the Crypto Market
The modern retail investor now accounts for up to 20.9% of US equity trading volume, a significant increase from 18.5% the previous year, according to Bloomberg data. Although institutions still dominate with 30.2% of the volume, the gap is closing rapidly.This growth is not only quantitative but also qualitative.
Retail traders are demonstrating a clear migration towards derivatives markets, a trend driven by the expansion of new products in the crypto space and the experience gained in risk management.
Instead of “all-in” bets, the modern retail investor is actively participating in options markets. In the last quarter, individual investors accounted for 29.3% of options volume, and even more than 50% of S&P500 options volume in 2025, setting trading records.
The growth of zero-day options (0DTE) is particularly noteworthy; in fact, it is a risky form of trading that allows very short-term predictions on index movement, whose popularity has been highlighted by CBOE.
The influence of 24/7 cryptocurrency trading is also transforming the stock market. Up to 9% of stock trades now occur outside official trading hours, compared to just 1% in 2019. This demand for flexibility and 24/7 operations, along with the interest of foreign investors, is redefining the market.
Furthermore, retail is venturing into the high-profile IPO market, causing dramatic spikes in stock trading for newcomers like Figma Inc. and Circle Internet Group Inc., attracted by the combination of value and the “meme potential” of these companies.
