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Retail Investors Dump Stocks: Major Sell-Off Seen

7 Nov

Summary

Retail investors sold $338 million in US stocks on Thursday.
This marks the largest single-day net selling since March 2020.
Investors avoided buying dips, opting instead for leveraged ETFs.

Retail investors exhibited a significant capitulation on Thursday, dumping US stocks at a rate not witnessed since the early stages of the COVID-19 pandemic in March 2020. Vanda Research reported that everyday investors sold a net $338 million in individual US stocks on this day.

This marked departure from recent years' tendency to "buy the dip," as Vanda Research noted a lack of such activity in individual stocks. Instead, some investors continued to purchase leveraged exchange-traded funds. The broader market also experienced a sharp decline, with AI and chip stocks leading the sell-off, impacting the Nasdaq Composite significantly.

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