However, following the successful coordination by a large group of traders, the power dynamic has shifted exposing the vulnerability of the market as well as the weaknesses in firmsвЂ™ trading systems,вЂќ says Guy Warren, chief executive officer of FinTech ITRS Group. вЂњUntil now, retail trading activity has never been able to move the market one way or another. To put the gravity of the situation into perspective, on 27 January at the height of the GameStop saga, 24 billion shares were traded on US exchanges, surpassing the previously set record by 4 billion shares traded in the 2008 global financial crisis. It resulted in market conditions likened to the dot com bubble around the turn of the century, leading to concerns that institutional investors must now adapt their risk models to mitigate the possibility of this happening again. The events that took place involved stocks such as GameStop and AMC Entertainment in what is considered one of the first social media driven and coordinated buying regimes by retail investors. These day traders are less than 10% of their customers, but they represent more than half of their trades.вЂќ вЂњBut this has mainly been driven by a small portion of their customer base. вЂњFor the largest online brokers, the number of daily trades has tripled since 2019,вЂќ John Marshall, head of derivatives research at Goldman Sachs, commented on a retail investment podcast from the US bank.

Set up in 2013 the mobile trading app, now valued at $21 billion and proclaimed to be democratising finance, offers investors access to the financial markets with zero commissions. The Reddit revolution in the US has drawn attention to the potential power that a growing force of retail investors can wield in stock markets when equipped by social media.ДЄmateur investors have increasingly engaged with retail platforms in the last year, partly due to the pandemic leaving them idol at home, but also due to the newfound onslaught of information through social media and access to the market through retail brokerages and platforms such as Robinhood.

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