Leading investor and leading stock market bull, Michael Burry, known for his portrayal in the movie “The Big Short,” said on Twitter last week that he had received a subpoena from the Securities and Exchange Commission related to the agency survey on GameStop (GME).
Some recent trading issues have also turned out to be a headwind for the meme stock frenzy. Most of the original memes actions – including GameStop, AMC Entertainment (AMC), and BlackBerry (BB) – fell on Wednesday.
But institutional investors are still aware of the boom in retail. In a new interview, Suzanne Shank – the president and CEO of investment bank Siebert Williams Shank – said retail investing is “here to stay”, though she cautioned against the mentality herd that can lead to such exchanges.
âAs a business, we don’t retail directly,â said Shank, who spoke to Yahoo Finance on September 16. “But obviously, as a market player, we see the impact of retail, which has been quite significant.”
âThe question is whether – all of them – they seem to be operating as a group, moving together and stacking up, instead of making the same measured investment decisions as institutions,â he adds.
âBut there’s no question that the retail factor is here to stay, and it’s going to play a big role in how stocks move on a daily basis,â she said.
Over-the-counter trading accounted for 47.2% of total U.S. equity trading volume in January 2021, an increase from 41.5% last year and 37.3% from the same month in 2019, according to an analysis carried out by the professional association SIFMA.
In the results released last month, the Robinhood (HOOD) trading platform reported 22.5 million user accounts with money in them, a peak of 130% from 9.8 million in the same quarter last year. There were 7.2 million such accounts as of March 2020, the company said.
But wealthy investors continue to dominate the stock market. Richest 10% of U.S. families own 84% of global stocks and 92% of directly owned stocks, according to 2019 Federal Reserve survey analyzed by the New York Times.
Billionaires added $ 1.8 trillion in wealth during pandemic, says report published last month by the Institute for Policy Studies. Observers attribute the gains in part to the disproportionate amount of money wealthy people hold on the stock market.
Shank started his career as a civil engineer, before realizing that it could have more impact on the financing of projects than on their design.
After earning an MBA from the Wharton School at the University of Pennsylvania, she co-founded investment bank Siebert Cisneros Shank, later to become Siebert Williams Shank.
Speaking to Yahoo Finance, Shank noted that the rapid dissemination of information through finance-focused media helps retail investors compete with institutional traders.
âI think the advent of the average investor with access to CNBC and Yahoo and other media is giving retail investors more information,â she adds.
“[There] Before, institutional investors were the only ones who got breaking news – and now I think everyone is getting breaking news. “