U.S. stock market retail investors have set a new record in the first half of 2025, with the total trading volume reaching an unprecedented $6.6 trillion. Despite facing numerous challenges including tariff uncertainties, significant market fluctuations, and conflicts in the Middle East, retail investors continued a buying spree. Their trading activities culminated in a historic total.
In the first half of this year, retail investors purchased approximately $3.4 trillion worth of stocks while selling about $3.2 trillion. This indicates a stronger tendency to buy rather than sell despite market volatility. The trading environment has been notably tough, with tariffs announced by U.S. President Trump causing market panic.
Concerns of an economic slowdown and rising inflation due to a global trade war were rampant. The S&P 500 Index fell briefly into a correction zone and the Nasdaq Composite Index entered a bear market. However, this did not deter retail investors.
The cumulative net inflow of retail funds into U.S. stocks and exchange-traded funds (ETFs) reached $137.6 billion in the first half of the year. This bullish behavior is mirrored in data from Vanda Research, which recorded retail investors net buying stocks and ETFs worth $155.3 billion.
Retail investor confidence persists despite volatility
This surpassed the previous record of $152.8 billion set in the first half of 2021. Vanda Research attributes this surge to the “American exceptionalism” trade and significant buying on dips triggered by Trump’s tariffs. Notably active stocks included NVIDIA, Tesla, and Palantir, along with substantial investments in index-tracking ETFs like the SPDR S&P 500 ETF Trust and Invesco QQQ Trust Series I.
The average daily inflow of funds from retail investors was about $1.3 billion, marking a 21.6% increase compared to 2024. Retail portfolios saw an average increase of 6.2%, nearly matching the 6.1% rise of the S&P 500 Index during the same period. Marco Iachini, Senior Vice President of Vanda Research, highlighted the relentless momentum of retail investors.
He noted their strong performance and undiminished risk appetite. “Participation has reached an all-time high, the tendency to buy on dips is intact, and involvement in individual stocks continues to rise,” Iachini stated. Following two consecutive years of 20% increases, U.S. stocks maintained their upward trajectory, despite a volatile journey symbolizing a “V-shaped reversal.”
Factors such as easing trade tensions, improved corporate profit expectations, and robust economic data have driven U.S. stocks to new highs.
On the most recent trading day, strong employment data pushed major indexes to historical closing highs. The first half of 2025 has showcased the resilience and bullish sentiment of retail investors, positioning them as a formidable force in the U.S. stock market’s continued growth.